RHBCap postpones rights issue to Nov 19 after central bank's cap on Aabar

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KUALA LUMPUR (Sept 23): RHB Capital Bhd (RHBCap) has to delay its RM2.5 billion rights issue by nearly two months as the banking group needs to consult the relevant regulators with regards to the central bank's order to cap Aabar Investment PJS' subscription entitlement.

Recall that RHBCap had announced on Sept 17 that Bank Negara Malaysia had told the group to limit Aabar's subscription option to only 15% of its rights issue, instead of 21.9% as per its shareholding entitlement.

"... the entitlement date for the rights issue has now been extended from Oct 1 to Nov 23 to allow time for the board to engage with the relevant regulators and to deliberate and implement the rights issue in the most efficient manner, after considering the order," RHBCap said in its filing to Bursa Malaysia today.

"The board may, however, announce further extension(s) to the book closure date at a later date, should the company require additional time to implement the rights issue.

"The board also wishes to highlight that the total number of rights shares to be issued is subject to further changes, in order to give effect to the order," it added.

This confirmed a report published on the latest issue of the digitaledge WEEKLY (Sept 21–27), which quoted industry sources as saying that the proposed rights issue to raise RM2.5 billion might be delayed as the bankers working on the rights issue will be seeking more clarification from the central bank.

In its filing today, the country's fourth largest banking group announced that the ex-date for the rights issue of 517.7 million new shares in RHBCap at an issue price of RM4.82 is now rescheduled to Nov 19 from Sept 29.

Accordingly, the date for commencement of trading of the rights has been delayed to Nov 24 instead of Oct 2.

The date for the acceptance and payment for the rights issue has also been rescheduled to 5pm on Dec 8 from 5pm on Oct 19.

Meanwhile, the listing date for the right shares will be on Dec 21 instead of Oct 30.

Earlier this month, RHBCap announced that its major shareholders, the Employees Provident Fund (EPF) and OSK Holdings Bhd, have committed to subscribing fully to the remaining 266.86 million shares, representing a 51.55% stake based on their entitlements of 41.58% and 9.97% respectively.

The EPF is the single-largest shareholder of RHBCap with a 41.65% stake, while OSK has a 9.9% interest.

The remaining 250.8 million shares or 48.45% of the rights issue will be jointly underwritten by RHB Investment Bank Bhd, Affin Hwang Investment Bank Bhd, CIMB Investment Bank Bhd, Credit Suisse Securities (M) Sdn Bhd, Maybank Investment Bank Bhd and Public Investment Bank Bhd.

The rights issue was part of the banking group's restructuring plan, which will see the RHB Banking Group moving towards a "bank holding company" structure, in line with major banking groups across Asean.

Shares in RHBCap fell five sen or 0.82% to close at RM6.04, for a market capitalisation of RM15.63 billion.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)