SCIB shareholders approve rights issue and capital reduction

KUCHING (Jan 16): Sarawak Consolidated Industries Bhd’s (SCIB) shareholders have approved the issuance of free detachable warrants and a proposed reduction of the company’s issued share capital at an extraordinary general meeting (EGM) held on Thursday.

In a statement after the meeting, SCIB said shareholders approved a renounceable rights issue of up to 763.62 million new ordinary shares together with an equal number of free detachable warrants.

It said the issue will be undertaken on the basis of one rights share and one warrant for every existing SCIB share held on an entitlement date to be determined.

Shareholders also approved a reduction of the company’s issued share capital by RM110 million under Section 117 of the Companies Act 2016.

Executive chairman Datuk Datuk Chong Loong Men said the EGM outcome provides greater clarity and flexibility for the company to move ahead with its financial and operational initiatives.

“We appreciate the confidence and mandate given by our shareholders. These approvals place SCIB in a better position to strengthen its balance sheet and support the group’s planned activities in a disciplined and orderly manner,” he said.

The rights issue with free warrants is expected to raise a minimum of RM10 million to meet the company’s funding requirements.

According to the circular to shareholders, proceeds will be used mainly for factory construction and machinery purchases, as well as partial repayment of bank borrowings, working capital needs and expenses related to the proposals.

Chong has also undertaken to subscribe to the rights issue, including through excess applications if necessary, to ensure the minimum proceeds are achieved.

SCIB said with the approvals secured, the group is better positioned to advance its operational priorities and funding plans.

“As the company progresses with the implementation of the proposals and executes its ongoing initiatives, SCIB remains focused on strengthening its fundamentals, enhancing execution capabilities and positioning the Group for more sustainable growth over the medium to long term,” it added.