Yong Tai on track to bring in HK's Sino Haijing as substantial shareholder

KUALA LUMPUR (Aug 10): Property developer Yong Tai Bhd is despatching a circular to its shareholders today on its proposed corporate exercise to bring in Hong Kong-listed Sino Haijing Holdings Ltd as a new substantial shareholder.

In a statement today, Yong Tai chief executive officer Boo Kuang Loon said the company will seek shareholder's approval for the corporate exercise at its forthcoming extraordinary general meeting (EGM) on Sept 1.

Upon obtaining approval, Sino Haijing will seek the Securities Commission Malaysia's approval on the exemption to undertake a mandatory acquisition of all the remaining Yong Tai shares.

Under the corporate exercise, Yong Tai will issue new shares and irredeemable convertible preference shares (ICPS) to Sino Haijing, as well as utilise the share premium to reward existing Yong Tai shareholders via a bonus ICPS.

"The proposed bonus ICPS of up to 20.05 million on the basis of one ICPS for every 10 Yong Tai shares held by the shareholders of the company is to reward the existing shareholders for their continuous support and also to encourage further participation in the company," said Boo.

Yong Tai had on Feb 4 entered into a subscription agreement with Sino Haijing's subsidiary Impression Culture Asia Ltd to formalise the parties' intention and understanding in relation to the proposed corporate exercise.

Under the deal, Sino Haijing will invest RM280 million in Yong Tai via the subscription of new shares, of which Impression Culture will subscribe for Yong Tai's special issue of 150 million new shares amounting to RM120 million. This represents 34.5% of Yong Tai's enlarged issued share capital at an issue price of 80 sen per share.

Impression Culture will also subscribe for 200 million ICPS at an issue price of 80 sen per share amounting to RM160 million.

As a result of the subscription of shares, Sino Haijing will emerge as a new substantial shareholder in Yong Tai.

Yong Tai has also proposed to undertake a private placement of up to 70 million new shares to independent third party investor(s), which will bring in another RM60 million to RM70 million for working capital.

Meanwhile, Yong Tai said work on the first phase of its Impression City project in Melaka is set to begin this month.

It added it will continue to seek opportunities to acquire more lands with good prospects for its future property development activities.

Yong Tai shares ended the morning session two sen or 1.79% higher at RM1.14, with 535,500 shares traded. Its market capitalisation stood at RM180.8 million. — theedgemarkets.com

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