KUALA LUMPUR (Sept 13): China-based shoemaker K-Star Sports Ltd surged 11.76% on active buying, after it proposed a private placement issuance of up to 26.6 million shares to raise RM2.24 million.

At 10.51 a.m., it rose one sen to 9.5 sen, with 4.5 million shares transacted, for a market capitalisation of RM25.3 million.

On Friday, K-Star said the placement shares represent 10% of its existing 266.4 million issued and paid-up shares that would be issued to independent third party investors to be identified.

Its five-day weigted average market price (5D-WAMP) up to Sept 8, 2016 (last practicable date) was 9.3 sen.

Based on an indicative issue price of 8.4 sen, it represented a discount of approximately 0.9 sen or 10% from the 5D-WAMP, up to and including Sept 8 of 9.3 sen.

Inter-Pacific Securities Sdn Bhd remisier Sam Ng told theedgemarkets.com that investors were most likely buoyed by confidence over K-Star, following the announcement.

“They probably see a chance for the stock to grow. The surge is most likely due to that sentiment,” he said.

K-Star said the gross proceeds would be utilised for its general working capital, within the next 12 months.