PETALING JAYA: HLT Global Bhd has proposed to undertake a private placement of up to 20% of its issued shares to raise up to RM76.84mil.

       In its filing with Bursa Malaysia, the company revealed that the bulk of the proceeds raised from the proposed exercise would be used to part-finance HLT’s business expansion plan to increase its production capacity.

       These would include the RM15mil earmarked to part-finance the construction of a new glove-dipping plant and infrastructure at Semenyih in Selangor.

       In addition, between RM34mil (under the minimum scenario) and RM42.5mil (under the maximum scenario) had been earmarked for the fabrication, installation and commissioning of between four and five new double-former glove-dipping lines.

       HLT said upon commissioning of the new lines, the group’s glove capacity production is expected to increase between 2.24 billion and 2.55 billion pieces from the current one billion pieces.

       The company said its proposed private placement exercise would entail between 141.48 million and 163.49 million shares, which represent approximately 20% of its total 817.44 million number of issued shares.

       It noted that the indicative issue price would represent a discount of 9.41% from the five-day volume-weighted average price of HLT shares up to and including the latest practicable date prior to the announcement of 51.88 sen.

       The exercise will be implemented in tranches and at different issue prices to enable each tranche to be determined at the relevant price fixing dates.

       HLT said the proposed private placement will enable the group to raise funds without incurring interest cost which would otherwise arise if the group were to borrow further to fund its business expansion and working capital requirements.

       “The board also views the proposed private placement as the most appropriate avenue of raising funds given the expected timeframe for completion of the exercise. The proposed private placement will also increase the capitalisation of the company and further strengthen the financial position of the HLT group,” it added.