KUALA LUMPUR (July 9): Asdion Bhd's board has proposed to undertake a capital reduction to cancel RM30.76 million of its issued share capital, to eliminate the company's accumulated losses.

In an exchange filing today, the ACE Market-listed company said the credit of RM30.76 million arising from the exercise will be used to reduce the accumulated losses, while the surplus after the elimination will be used to set off any future losses, or other purposes deem fit.

Asdion said the share capital reduction will enable the company to rationalise its statement of financial position, which may enhance its credibility with bankers, customers, suppliers, and investors.

It said the proposed exercise would not have any effect on the group's earnings, net assets, or substantial shareholders' shareholdings.

Asdion, which specialises in providing advanced integrated business and operations solutions, has been making losses since 2009.

According to the group's filing, its accumulated losses as at March 31 stood at RM31.61 million. This will be reduced to RM964,184 after the exercise, it said.

The proposal, subject to shareholders' approval, is expected to be completed by the fourth quarter of 2019.

Asdion's share price closed unchanged today at 20.5 sen, with 502,000 shares traded.