LEADING tiles manufacturer and information technology (IT) company YB Ventures Bhd (formerly Yi-Lai Bhd) has chosen the private placement path to fund the installation of a solar photovoltaic (PV) system to complement the group’s plan of erecting four new production lines to expand its production capacity.
Entailing up to 20% of its total number of issued shares to raise between RM21.1 mil and RM145.9 mil, the private placement exercise will facilitate the installation of a rooftop PV system at YB Ventures’ factory building and warehouse in Kulai (Johor), to fund future viable investments and to be utilised as working capital.
“In addition to reducing electricity consumption, the installation of solar PV system will also reduce the group’s environmental impact due to the energy intensive nature of our manufacturing activities,” commented YB Ventures’ executive director Datuk Au Yee Boon.
Moreover, the proposed private placement exercise will enable the group to raise additional funds without incurring interest costs as compared to conventional bank borrowings.
“It provides the group with an expeditious fundraising alternative from the capital market as opposed to other forms of fundraising while increases the size and strength of the company’s shareholders’ funds,” Au pointed out.
Moving forward, Au remains optimistic of the group’s future prospects as Malaysia has resumed interstate and overseas travel starting Oct 11.
“The resumption of free travel is another step forward towards normalcy and we anticipate a gradual economic recovery which in turn induce higher renovation activities within the country,” he projected.
“We believe that consumers are more health conscious in times of the pandemic and therefore pivot towards our health-friendly tiles for their renovation activities.”
For now, YB Ventures’ remains committed to fulfilling the backlog of orders that have built up since the imposition of full movement control order (FMCO) which started on June 1.
“The property, construction and building material sectors are poised for a rebound in tandem with the positive economic growth slated for 2022,” opined Au.
“Towards the 4Q 2021, we foresee pent-up demand for properties, an effective vaccine roll-out programme and a ow-interest rate environemnt. All these are set to bolster businesses that took a hit since last year.”
Meanwhile, a Bursa Malaysia filing on YB Ventures’ private placement exercise shows that shares of the company will be placed to third party investors at an issue price that will be fixed at a later date.
The placement shares will be issued at a price of not more than 10% discount to the five-day volume-weighted average market price (VWAP) of YB Ventures shares immediately preceding the price-fixing date.
“For illustrative purposes, the indicative issue price of the placement shares is assumed at 43.7 sen per placement share which represents a discount of about 9.93% to the five-day VWAP of YB Ventures shares up to and including the LPD (latest practicable date) of 48.52 per share,” the group said in its stock exchange filing.
At the close of yesterday’s (Oct 11) trading, YB Ventures was up 1.5 sen or 3.3% to 47 sen with 697,100 shares traded, thus valuing the company at RM114 mil. – Oct 12, 2021
