KUALA LUMPUR (Nov 12): Automotive parts manufacturer MCE Holdings Bhd (KL:MCEHLDG) plans to raise up to RM26.5 million via a private placement of shares to partly finance a new manufacturing factory in Serendah and projects it has secured.

Assuming all 61.75 million of its outstanding warrants are exercised prior to the proposed placement (maximum scenario), the placement will involve up to 18.53 million new MCE shares or 10% of its total number of issued shares at an issue price to be determined later.

The placement shares will be placed out to independent third-party investors to be identified, its bourse filing showed.

MCE said the issue price of the placement shares may be fixed at a discount of not more than 10% to the volume weighted average price (VWAP) of MCE shares for the five market days immediately preceding the price-fixing date.

The expected proceeds to be raised is based on an illustrative issue price of RM1.43 per placement share.

Proceeds from the placement will be used as capital expenditure to finance two contracts secured by the group to supply various electronic and mechatronics parts for Perodua and Proton car models (RM15 million), and to partly finance the construction of its new manufacturing factory on Serendah (RM11.33 million).

Construction of the Serendah manufacturing factory is now 69% complete. On completion, it is expected to commence operation in the second half of 2025.

The board expects the proposed exercise to be completed by the fourth quarter of 2024.

RHB Investment Bank has been appointed as the principal adviser and placement agent for the proposed placement.  

MCE shares slipped one sen or 0.61% to close at RM1.62 on Tuesday, giving the group a market capitalisation of RM200 million.