KUALA LUMPUR (Sept 6): YB Ventures Bhd (formerly known as Yi-Lai Bhd) said today its rights issue of irredeemable convertible unsecured loan stocks (ICULS) at four sen per rights share was oversubscribed by 46.6%.

In a statement, the tile manufacturer and information technology company said it saw valid acceptances and valid excess applications totalling 1.77 billion rights shares, compared with the 1.21 billion made available for subscription.

The 1.21 billion ICULS will be listed and quoted on the Main Market of Bursa Securities on Sept 10, 2021, under the stock's short name YB-LA (5048LA), it noted.

The group expects to raise about RM48.4 million from the right issue of ICULS with more than 90% of the proceeds raised to be utilised to upgrade its existing tile production lines and construct four new production lines.

YB Ventures executive director Datuk Au Yee Boon said the overwhelming response was an encouraging indication by its shareholders of the group’s business fundamentals and future perspectives to further grow its market share and bottom line.

“We are on the right track in implementing our strategic transformation plan, and I am positive that the group may even achieve its internal targets ahead of our expectations as we step up our momentum.

“YB Ventures seeks to expand its production capacity and capitalise on the recovery of its operating markets. The nearly RM49 million raised from the ICULS issuance will provide adequate support to achieve these objectives,” Au added.

The conversion price of each ICULS is set at 48 sen to be converted to every one new YB Ventures share within the five-year tenure from the date of issuance of the ICULS.

Au explained that shareholders who wish to convert the ICULS could either opt to top up 44 sen to convert (48 sen minus four sen ICULS issue price), or surrender 12 ICULS for one new YB Ventures share.

Looking forward, Au said the gradual recovery of the economy is positive for the group. 

“With property transactions expected to rebound encouragingly in 2022, we will be a direct beneficiary as our products will naturally see strong growth in sales, potentially recovering to pre-pandemic levels or even higher. While we are cautiously optimistic about the outlook of the property and construction segment, we are also actively exploring viable opportunities in other segments that can enhance our earnings visibility,” Au added.

YB Ventures rose one sen or 1.96% to 52 sen at the noon break today and had a market capitalisation of RM126 million.