KUALA LUMPUR (Dec 7): Less than five months after completing a private placement in July, Jentayu Sustainables Bhd is planning another placement — this round to raise up to RM62.96 million — for the clean energy solutions provider to fund its pre-development expenditures, new projects and working capital.

The second placement exercise came after the group issued 96.94 million shares in July that saw it raise RM11.1 million for its pre-development spending. Announced in June last year, the July placement was initially planned to raise as much as RM47.07 million by placing out up to 142.63 million shares that represented not more than 30% of its issued shares at the time.

The latest placement, the group said in a bourse filing on Thursday, will involve the issuance of up to 57.24 million shares — 10% of its share base of 572.37 million shares — to third-party investors to be identified later, at an issue price to be determined.

Based on an illustrative issue price of RM1.10 per share — a 10% discount to the five-day volume weighted average market price of Jentayu shares — the private placement is expected to raise up to RM62.96 million.

The company said RM26 million is to partially finance the group’s pre-development expenditures for project Oriole, which involves the development of two hydropower plants in Sabah, along Sungai Maligan and Hulu Sungai Padas.

The estimated project cost to develop these two hydropower plants is RM2.77 billion, which will be funded by bank borrowings and/or other fundraising exercises to be secured at a later date, said Jentayu.

As at Dec 6, Jentayu had invested RM73.4 million for Oriole’s pre-development expenditures. It estimated that it will need to invest an additional RM26 million to complete the project’s pre-development phase.

Of the balance proceeds it expects to raise, it wants to use RM22.36 million for working capital and RM5.7 million for future viable investments in renewable energy-related projects, with the balance RM5 million to be used to defray estimated expenses for its proposed acquisition of two hydropower plants in Tenom, Sabah, and one solar photovoltaic energy-generating facility in Pokok Sena, Kedah.

It also earmarked RM1.6 million for the expansion of its healthcare division, and set aside the remaining RM2.3 million for estimated expenses relating to the private placement, which needs the approval of Bursa and Jentayu’s shareholders.

It has appointed Mercury Securities as the principal adviser and placement agent for the exercise, that is expected to be completed in the second quarter of 2024.

Jentayu’s shares closed one sen or 0.82% lower at RM1.21 on Thursday, bringing the group a market capitalisation of RM508 million. Year to date, the stock has gained 61%.