KUALA LUMPUR (May 28): Scomi Group Bhd (SGB) shares fell as much as 16% this morning after the firm said it is making a cash call to raise RM214 million, an amount that is nearly three times more than its current market capitalisation of RM72 million, to pare down debts.

At 9.26am, SGB was down 11.11% or 1 sen to 8 sen with 1.28 million shares traded. The stock had earlier slipped to a low of 7.5 sen.

In a filing with Bursa Malaysia yesterday, SGB has proposed a wide-ranging corporate exercise, which also includes a rights issue that will be sweetened by free warrants, share consolidation, liabilities settlement and shares capital reduction.

The group has fixed the price for its rights issue at 18 sen per share.

The proposed rights issue would involve issuing up to 1.19 billion rights shares with free warrant C of up to 396.30 million units. For every three rights shares subscribed, shareholders will be given a free warrant C.

To pave the way for the cash call, Scomi Group will undertake a capital reduction to slash its paid-up capital to RM40 million from RM224.96 million currently, and a share consolidation on the basis of four shares to consolidate into one share prior the rights issue.

As at May 23, 2018, being the latest practicable date prior to this announcement, its issued share capital was RM224.96 million comprising 1.03 billion shares.