KUALA LUMPUR (March 1): Construction and power utilities group JAKS Resources Bhd is looking to raise up to RM53.15 million through a private placement mainly to repay its credit facilities and fund its working capital.

In an exchange filing on Friday, JAKS said RM33 million of the proceedings will be earmarked for the repayment of credit facilities, another RM18.65 million for working capital requirements, and the remaining RM1.5 million will be used to defray the exercise’s estimated expenses.

As at Feb 15, JAKS’ total bank borrowings stood at RM485.88 million, of which RM428.74 million constitutes long-term borrowings and RM57.14 million comprises short-term borrowings.

The private placement entails the issuance of up to 303.69 million shares — 10% of the group's enlarged issued share capital of 3.04 billion shares — to yet-to-be-identified investors at an issue price to be determined later.

JAKS said that based on an illustrative price of 17.5 sen, a discount of 8.14% to the five-day volume weighted average price of JAKS shares up to Feb 15 of 19.05 sen, the group expects the exercise to raise up to RM53.15 million.

JAKS noted that it had not undertaken any other fundraising exercise in the prior 12 months.

The private placement is expected to be completed in the second quarter of 2024, subject to requisite approvals from Bursa Securities and other relevant authorities, it said.

M&A Securities has been appointed as the adviser and placement agent for the exercise.  

Shares in JAKS closed down 1.5 sen or 7.89% at 17.5 sen on Friday, valuing the group at RM414.72 million. The counter has fallen 23.91% over the past one year.