Yong Tai said on Friday Sino Haijing&rsquo s subsidiary Impression Culture Asia Ltd would subscribe for Yong Tai&rsquo s special issue of 150 million new shares amounting to RM120mi. This represents 34.5% of the enlarged issued and paid-up share capital of Yong Tai at an issue price of 80 sen a share.

Impression Culture will also subscribe to 200 million new Irredeemable Convertible Preference Shares (ICPS) at an issue price of 80 sen each which is the ICPS par value for RM160mil.

As a result of the subscription of shares, Sino Haijing will emerge as a new substantial shareholder in Yong Tai holding more than 33% of the voting shares in Yong Tai. 
&ldquo Therefore, Sino Haijing will seek an exemption from the authorities from undertaking a mandatory takeover offer for all the remaining Yong Tai shares that it does not already own after the proposed Special Issue and ICPS,&rdquo it said. 

Yong Tai executive director Boo Kuang Loon said the participation of Sino Haijing &ldquo demonstrates Sino Haijing&rsquo s commitment and confidence in Yong Tai&rsquo s business direction&rdquo .

&ldquo Based on Yong Tai&rsquo s ongoing project as well as the scale of the projects to be undertaken in Impression City and Impression Melaka, the board envisages that the immediate funding requirements of the group will be significant.&rdquo

&ldquo Therefore, the proposed special issue and ICPS will strengthen the Company&rsquo s financial position with enhanced shareholders&rsquo funds. These factors are expected to facilitate the continuous business expansion plans of Yong Tai,&rdquo he added. 

The corporate exercise would enable Yong Tai to raise additional funds without incurring high borrowing cost. 

Yong Tai is also undertaking a proposed Bonus Issue of up to 20.05 million new ICPS on the basis of one new ICPS for every 10 Yong Tai shares held by the shareholders of the company as at entitlement date to be determined and announced later. 

Under the corporate exercise, Yong Tai has also proposed to undertake a private placement of up to 70 million new shares to independent third party investor(s) yet to be identified. 

The issue price, which will be determined at a later date, would not be more than 10% discount from the five-day weighted average market price of Yong Tai shares immediately preceding the price fixing date.  

There could be several price fixing dates as the placement is expected to be implemented in tranches within six months after the receipt of all relevant approvals. 

Based on an indicative issue price of 80 sen apiece, Yong Tai expects to raise gross proceeds of RM336mil from the proposed special Issue, ICPS and private placement. 

Of the RM336mil, it said RM150mil will be used to fund the balance purchase consideration for the acquisition of Impression Land and the construction and production cost for the Impression Melaka project RM100mil to part-financing of Yong Tai&rsquo s existing project and/or future projects and RM60mil for future acquisitions of new land banks and/or property development related projects by the group.