Synagie proposed Friday a renounceable non-underwritten rights issue of up to 39.72 million new shares at S$0.10 each on the basis of three rights shares for every 20 existing shares.
The issue price is a discount of around 28.1 percent to the stock’s closing price of S$0.139 on Friday, Synagie said in a filing to SGX.
The net proceeds are expected to be from S$2.12 million to S$3.84 million, and most of the funds raised are earmarked to fund expansion and growth plans for 2020, Synagie said.
“The group plans to commence operations in Indonesia and accelerate the onboarding of brand partners in the rapidly growing e-commerce markets of Malaysia, Thailand, Philippines and Vietnam through its appointment as a regional Lazada Partner,” Synagie said.
Part of the net proceeds will also be used for working capital, including for distribution costs, administrative expenses and other operating expenses, the filing said.
The offering isn’t underwritten because the company believes the pricing is “sufficiently attractive” for existing shareholders who have acquired shares at a historically higher price and the company will enjoy cost savings from not paying underwriting fees and commissions, Synagie said.
Synagie said there was no minimum amount to be raised from the rights issue, and if it isn’t able to raise sufficient funds, it will find alternative funding, including raising capital via private placements.
Synagie added it has also received irrevocable undertakings from the executive directors — Lee Shieh-Peen Clement, Tai Ho Yan and Zanetta Lee Yue — and the controlling shareholder, Metadrome, to take up a collective 11.87 million rights shares.
Other large shareholders — Agate Investments with an 11.47 percent stake, Harmony Treasure Holdings with a 7.19 percent stake and Tai Lai Fun Cindy with a 4.89 percent stake — have given irrevocable undertakings to take up an aggregate of 9.35 million rights shares, the filing said.