KUALA LUMPUR: G Capital Bhd (GCAP) has proposed a renounceable rights issue with up to RM102.62 million nominal value of 1.28 billion five-year, 5.0 per cent of redeemable convertible unsecured loan stocks (RCULS) at 100 per cent of its nominal value of 8.0 sen each.
In an exchange filing today, the company said the rights issue would be based on four RCULS for every one existing ordinary share in GCAP held on an entitlement date to be determined later.
The rights issue will be raising at least RM41.78 million and RM102.62 million under the minimum and maximum subscription levels.
GCAP said the proceeds from the exercise would partly finance project costs and accelerate the completion of its renewable energy projects.
This includes the solar photovoltaic energy generating system and mini-hydropower plants projects.
Executive director Tan Sri Dr Ali Hamsa said the company is turning into full thrust to hasten solar PV systems and mini-hydropower plants projects.
"The rights issue will gear us well financially for that purpose," he said in a statement today.
Out of the RM102.62 million to be raised under the maximum subscription level, RM5.6 million are currently earmarked to part-finance project costs of the Solar PV systems (9.4MW) and RM93.82 million is being allocated for mini-hydropower plants (43.2MW) projects.
"After deliberation with the board, we have decided to undertake this rights issue, which enables the company to manage its cash flows more efficiently," added Ali.
GCAP said the coupon fixed rate of 5.0 per cent per annum is payable every quarter, citing that the RCULS may be converted into new GCAP shares by surrendering one RCULS together with cash of 82 sen.
"The rights issue allows participating shareholders to earn interest income from the RCULS while witnessing GCAP's growth trajectory before increasing their stake at a pre-determined conversion price," it said.
The management said some solar PV system projects are expected to start operating in the second half of this year. Thus, it will contribute to the company's revenue from this year onwards over a span of 25 years, barring any unforeseen circumstances.
It also expected the mini-hydropower plants to start contributing to the company's revenue from the financial year ending December 31, 2025, onwards for a span of 21 years from the date of commission of the respective plants.