KUALA LUMPUR (May 11): Metro Healthcare Bhd (KL:METRO) has proposed a bonus issue of warrants on the basis of one warrant for every four existing shares held.
The exercise will involve the issuance of up to 244.73 million warrants with a tenure of five years. As of April 21, the group’s issued share capital stood at RM56.29 million, comprising 978.91 million shares, with no treasury shares, according to its filing with Bursa Malaysia.
Based on an illustrative exercise price of 20 sen per warrant — representing a discount of about 2.4% to the five-day volume-weighted average price of 20.5 sen up to April 21 — the group could raise gross proceeds of up to RM48.9 million.
The proceeds have been earmarked for working capital, capital expenditure and potential repayment of borrowings.
The proposal is subject to shareholders’ approval at an extraordinary general meeting to be convened at a later date. The exercise is expected to be completed by the third quarter of this year, with RHB Investment Bank Bhd acting as principal adviser.
Metro Healthcare, which operates a network of obstetrics, gynaecology and in-vitro fertilisation (IVF) centres, said it has not undertaken any other fund-raising exercises in the past 12 months.
Metro Healthcare is in expansion mode. In October last year, it announced plans to diversify beyond its obstetrics and gynaecology base with the proposed acquisition of RMC Specialist Sdn Bhd, a company owned by its executive vice-chairman and major shareholder Dr Tay Swi Peng @ Tee Swi Peng, paving the way for the group’s entry into the multi-disciplinary hospital segment.
RMC Specialist plans to develop a four-acre parcel of commercial land in Bandar Rimbayu, Selangor, into a multi-disciplinary hospital with a total built-up area of 340,000 sq ft.
The first phase will feature 120 beds and five operating theatres, with construction expected to begin in the second quarter of 2026 and be completed by the fourth quarter of 2027.
“The proposed hospital is expected to broaden the group’s service offerings and may provide an additional source of revenue upon commencement of operations. However, the board notes that such development is subject to execution risks and will require a gestation period before achieving optimal utilisation levels,” said the group.
The risks involved are rising operating costs, particularly staff-related expenses, competition within the private healthcare sector, dependency on qualified medical professionals and evolving regulatory requirements, said Metro Healthcare.
According to AskEdge, Metro Healthcare is currently trading at a price-earnings multiple of 37.5 times, placing it in the mid-to-upper range among its peers, and at a price-to-net asset value of 2.9 times.
Shares in Metro Healthcare closed unchanged at 22 sen on Monday, giving it a market capitalisation of RM215.4 million.