KUALA LUMPUR: Offshore support services provider Yinson Holdings Bhd intends to raise about RM299.5 million through private placement — a move to pare down its bank borrowings.

As at Jan 31, Yinson’s total loans and borrowings stood at RM823.18 million; while its gearing ratio stood at 0.57 times in financial year 2015. After the placement exercise, Yinson expects its total borrowings to reduce to RM533.67 million, while gearing could drop to 0.31 times.

In a filing with Bursa Malaysia yesterday, the group said by assuming the issue price for the placement shares of RM2.90 apiece, it could raise gross proceeds of up to RM299.5 million, of which RM289.51 will be for repayment of bank borrowings, while the remaining will be for the corporate exercise expenses.

Yinson (fundamental: 1.5; valuation: 1.5) said the proposal is to undertake a private placement of new ordinary shares of up to 103.28 million shares, representing up to 10% of its issued and paid-up share capital.

“The placement shares will be placed to third party investors to be identified at a later date,” the group said, adding that the issue price will not be priced at more than a 10% discount to the five-day volume weighted average market price of its shares immediately before the price-fixing date.

This article first appeared in The Edge Financial Daily, on June 26, 2015.