TILES manufacturer and information technology (IT) company YB Ventures Bhd (formerly Yi-Lai Bhd) has received resounding approval from shareholders for its proposed issuance of irredeemable convertible unsecured loan stocks (ICULS).
At the company’s extraordinary general meeting (EGM) yesterday, a 99.99% approval was received from shareholders who voted on the resolution.
“We are confident that following the planned production capacity expansion with the proceeds raised, YB Ventures will be fully equipped to implement its strategic plan and capitalise on the recovery of its operating markets,” commented YB Ventures’ executive director Au Yee Boon.
“After deliberation with the management team, we have decided to embark on this funding option as it enables the group to raise funds without incurring high-interest costs compared to borrowings from financial institutions.
“Obviously, the 0.10% annual coupon payment on the nominal value of the ICULS is much lower than the base lending rate of financial institutions.”
The proposed rights issue entails the listing of up to 1.21 billion ICULS on the basis of five ICULS at 4 sen each for every one existing share in YB Ventures held on an entitlement date to be determined later.
Under the maximum subscription level, the group will be able to raise RM48.5 mil from the issuance of the ICULS.
“I applaud the management for taking this bold decision to ramp up the group’s capacity by 50% amid the COVID-19 pandemic,” noted YB Ventures chairman Tan Sri Dr Ali Hamsa who was recently appointed as the chairman of KPJ Healthcare Bhd.
“This shows that YB Ventures has strong confidence on its prospects ahead, and I believe the group will be able to reap the benefits once the situation returns to normalcy.”
YB Ventures intends to utilise most of the proceeds raised to upgrade its existing production lines and to construct four new production lines which amount to approximately RM45.6 mil.
For context, YB Ventures’ existing manufacturing facilities comprise eight production lines with a production capacity of about 7.12 million sq metres of ceramic, homogenous and porcelain tiles annually.
In April, YB Ventures said it saw a strong interest among the members of the Real Estate & Housing Developers’ Association (REHDA) on the group’s new flagship product, the Talos Living Tiles which is the first negative ion tiles launched in Malaysia.
According to Au, the launch of Talos Living Tiles is a step-up for the Group as it moves towards the premium segment.
Utilising YB Venture’s proprietary ground-breaking Nano Glazing technology, the coated tiles produces and releases negative ions into the air, thus improving indoor air quality and subsequently bring about a healing effect to the body.
With millions of ringgit have already been invested in the development and production of the Talos Living Tiles, Au is confident that the group will exceed its RM30 mil sales target over the next three years based on the positive feedback from property developers and end-users.
At the close of trading yesterday, YB Ventures was down 2 sen or 3.54% to 54.5 sen with 91,700 shares traded, thus valuing the company at RM133.41 mil. – July 1, 2021
