KUALA LUMPUR: Leading Electronics Manufacturing Services (EMS) provider VS Industry Bhd (VSI) announced plans to undertake a bonus issue and free warrants.
Managing director Datuk SY Gan said the bonus issue of shares is an alternative avenue for the company to reward shareholders in addition to dividends.
"Thus, this is a form of gratitude to all our shareholders who have been through the ups and downs with us.
"Besides, this is expected to improve the marketability and trading liquidity of our shares and encourage greater participation by investors as well as potentially broadening the shareholder base," he said in a statement today.
The bonus issue will see an issuance of up to 1.92 billion new shares on the basis of 1 bonus share for every one VSI share.
In addition, the company will also issue one free warrants for every 5 VSI shares involving a total of 768.2 million free warrants.
"Moving ahead, our focus remains on providing top quality delivery on a timely basis to our customers while maintaining a standard of excellence in our execution.
"On balance, we are upbeat on the group's prospects and look forward to the continuous support of our shareholders as we propel VSI to greater height," SY Gan said.
The exercise price of the warrants will be determined and fixed by the VSI board at a later date after all relevant approvals have been obtained.
The first 30 per cent from the proceeds will be used for working capital purposes, while the next 20 per cent for repayment of bank borrowings.
The balance 50 per cent for potential investments and expansion of facilities.
The exercise is expected to be completed by second quarter of 2021.