Maxland Bhd has proposed a rights issue aimed at raising up to RM32.07 million to fund maintenance of its timber camp infrastructure, tree replanting and plantation improvement works, as well as general working capital.
The proposed issuance will involve up to 2.405 billion new rights shares, offered at two sen each, on a one-for-one basis for existing shareholders, according to a filing with Bursa Malaysia.
Maxland Bhd has proposed to offer 2.405 billion rights shares at two sen each on the basis of one new share for every one existing share held.
The two-sen issue price represents a 16.32% to 32.2% discount compared with Maxland’s five-day to 12-month volume-weighted average market price of 2.78 sen to 3.9 sen as of Feb 11.
Non-independent and non-executive chairman Datuk Abd Aziz Haji Sheikh Fadzir has committed to fully subscribe to his entitlement of 17.7 million rights shares, with an additional undertaking for up to 110 million shares if required.
Assuming full subscription and no exercise of the company’s 801.81 million outstanding warrants B, Maxland expects to raise RM32.07 million from the issuance of approximately 1.6 billion rights shares. Proceeds will be used to maintain timber camp infrastructure and processing plants, support tree plantations, cover working capital needs, and defray expenses related to the rights issue.
Over the past five years, Maxland has conducted five equity fundraising exercises, including a RM6.78 million private placement and a RM51 million redeemable convertible note issuance in June 2021, a RM2.05 million private placement in December 2021, a RM13.64 million private placement in January 2023, and an RM11.37 million private placement in February 2024.
The rights issue remains subject to shareholder approval at an extraordinary general meeting, with completion anticipated in the second quarter of 2026.
Maxland is 19% owned by its 73-year-old managing director Datuk Lim Nyuk Sang. Shares in the company were untraded on Thursday, with the last transaction on Feb 9 at 3.5 sen, valuing the group at RM56.13 million.
