KUALA LUMPUR: Genting Singapore PLC plans to raise up to S$1.63 billion from a proposed rights issue of up to 2.04 billion new shares of 80 cents each.

Genting Singapore said in a statement to the Singapore Exchange the rights shares would be on the basis of one for every five held.

"The rights issue is expected to raise gross proceeds of up to S$1.63 billion and is undertaken to pro-actively strengthen the balance sheet of the company and its subsidiaries (the "Group"), enhance its financial flexibility and competitive position and facilitate future business expansion," it said.

It added the rights issue was to pro-actively strengthen the group’s balance sheet, enhance its financial flexibility and competitive position and facilitate future business expansion.

"The Company intends to use approximately 60% of the net proceeds raised from the rights issue for funding of future acquisitions and/or investments undertaken by the group, or joint ventures, strategic collaborations, or alliances in areas related to its principal business in the leisure, hospitality and gaming sectors as and when such opportunities arise.

"The balance 40% of the net proceeds will be used for working capital purposes (which includes repayment of bank borrowings)," it added.

Genting Singapore said the rights issue offered shareholders an opportunity to subscribe for the rights shares at 80 cents per rights share. The issue price is a discount of about 32.8% to the closing price of S$1.19 per share on Sept 8, being the last market day before the date of this announcement; and a discount of about 28.9% to the theoretical ex-rights price of S$1.125 per share.

The company has appointed DBS Bank Ltd and CIMB Bank Bhd (Singapore branch) as the joint financial advisers and joint lead managers for the rights issue and DBS Bank, CIMB-GK Securities Pte. Ltd, J.P. Morgan (S.E.A.) Ltd, ABN AMRO Bank N.V. (Singapore branch), CLSA Singapore Pte Ltd, Deutsche Bank AG (Singapore branch), The Hongkong and Shanghai Banking Corp Ltd (Singapore branch) and  UBS Investment Bank as the joint lead underwriters for the rights issue.