KUALA LUMPUR (Aug 11): Pertama Digital Bhd has said it is not proceeding with the placement of its shares to Australia-based Macquarie Bank Ltd to raise gross proceeds of up to RM87.8 million.  

The group had in March inked a subscription agreement for Macquarie Bank to subscribe up to 43 million new shares of the group, representing 10% of Pertama Digital’s share base of 433.36 million shares at that time.

In a bourse filing on Friday (Aug 11), Pertama Digital said both parties have now decided to mutually terminate the subscription agreement effective Aug 15, with no subscriptions to be made up to that date.

The group added that it had, to date, issued 4.85 million placement shares under the exercise, raising total gross proceeds of RM12.8 million.

Pertama Digital said the termination was decided by the board after taking into consideration, among others, the group’s current financial condition as well as the adequacy of its financial resources for its ongoing business activities.

The group is expected to pay a termination fee of RM2.5 million to Macquarie Bank by Aug 15. Nonetheless, the group said the termination is not expected to have any other material effect on its financial results for the year ending Dec 31, 2023 (FY2023).

In August last year, Pertama Digital, formerly known as Sinotop Holdings Bhd, triggered paragraph 8.03A(2)(a)(b) of the Main Market Listing Requirements after selling its China-based textile subsidiary Be Top Group Ltd for RM70 million, with the aim of becoming a pure-play digital services provider.

The group had proposed the private placement to allow the group to raise funds expeditiously notwithstanding its status as an affected listed issuer.

"The proposed placement does not form part of the regularisation plan of Pertama Digital. The proposed placement is intended to provide Pertama Digital with an interim source of funds," the group had said.

Pertama Digital had planned to use RM35 million from the gross proceeds raised via the placement for the acquisition of businesses in the digital solutions sector, and another RM35 million for the expansion of business via acquisitions and investments into other digital solutions businesses. It planned to allocate RM16.26 million for working capital, leaving RM1.5 million for expenses for the placement.

On Tuesday, the group said it is seeking an extension of one year until Aug 9, 2024, to submit its regularisation plan to the relevant regulatory authorities.  

Pertama Digital owns and operates a mobile application known as MyPay which consolidates the e-services of Malaysian government agencies into a single digital platform. It also owns and operates a website app known as eJamin which allows users to make payment electronically for criminal courts bails.

For 1QFY2023,  the group slipped into the red with a net loss of RM1.77 million, against a net profit of RM5.08 million a year ago, amid lower revenue and higher operating expenses. Quarterly revenue fell 73.58% to RM1.35 million, from RM5.11 million previously.

Shares in Pertama Digital closed down six sen or 1.96% at RM3 on Friday, giving the group a market capitalisation of RM1.32 billion. Compared to one year ago, the stock has appreciated by 223% from 93 sen.

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