Memiontec Holdings Ltd Proposes Renounceable Rights Cum Warrants Issue: What Investors Need to Know

In a significant move to bolster its financial position and capital base, Memiontec Holdings Ltd. (the “Company”) has announced a proposed renounceable rights cum warrants issue of up to 440,514,000 new ordinary shares in the capital of the Company (“Rights Shares”) at an issue price of S\$0.009 for each Rights Share (the “Issue Price”), with up to 704,822,398 free detachable warrants (“Warrants”).

Key Points:
Proposed Rights cum Warrants Issue: The Company is proposing a renounceable non-underwritten rights cum warrants issue of up to 440,514,000 Rights Shares at an issue price of S$0.009 per share, and up to 704,822,398 Warrants, each carrying the right to subscribe for one (1) new ordinary share in the capital of the Company (“New Share”) at an exercise price of S$0.003 per New Share.**
Issue Size and Terms: As at the date of this announcement, there are 660,771,000 Shares (excluding nil treasury shares and nil subsidiary holdings) in issue. Assuming no new Shares are issued on or prior to the Record Date and all Entitled Shareholders subscribe in full and pay for their pro rata entitlements of Rights Shares with Warrants and/or excess applications for the Rights Shares with Warrants, 440,514,000 Rights Shares and 704,822,398 Warrants will be issued.
Discount and Pricing: The Issue Price represents a discount of approximately 76.9% to the volume-weighted average price (“VWAP”) of S$0.039 per Share for trades done on the SGX-ST on 18 December 2024 (being the last trading day on which the Shares were traded on the Catalist Board of SGX-ST prior to the release of this announcement); and 66.7% to the theoretical ex-rights price (“TERP”) of approximately S$0.027 per Share based on the VWAP. The Exercise Price represents approximately 92.3% to the VWAP of S$0.039 per Share for trades done on the SGX-ST on 18 December 2024 and approximately 88.9% to the TERP.**
Rationale: The Company is proposing the Proposed Rights cum Warrants Issue to raise proceeds for general corporate and working capital purposes.

Details of the Proposed Rights Cum Warrants Issue

The Proposed Rights cum Warrants Issue is on the basis of 2 Rights Shares for every 3 existing Shares held by all shareholders who are eligible to participate in the Proposed Rights cum Warrants Issue as at a record date to be determined by the Directors.
Issue Price and Exercise Price: The Issue Price and Exercise Price have been determined taking into account the prevailing market conditions and the market price of the Shares. The Rights Shares will be allotted and issued pursuant to Shareholders’ approval to be obtained at an Extraordinary General Meeting (the “EGM”).**
Warrants Terms: The Warrants are immediately detachable from the Rights Shares upon issue and will be issued in registered form. Each Warrant will carry the right to subscribe for one (1) New Share at the Exercise Price at any time during the period commencing on and including the date of issue of the Warrants and expiring on 36 months from the date of issue.

Why This Matters for Shareholders

The proposed issue will strengthen the financial position and capital base of the Group, fortify its balance sheet, and enhance its financial flexibility.
Eligibility: The Company proposes to provisionally allot the Rights Shares and Warrants to the Entitled Shareholders, comprising Entitled Depositors and Entitled Scripholders (each as defined herein), on the basis of their shareholdings as at the Record Date.
Entitled Shareholders: Entitled Shareholders will be eligible to participate in the Proposed Rights cum Warrants Issue and receive the Offer Information Statement together with the appropriate application forms. Those who wish to participate in the Proposed Rights cum Warrants Issue may provide an address in Singapore for the service of notices and documents.
Foreign Shareholders: The Offer Information Statement and its accompanying documents will not be despatched, lodged, registered or filed in any jurisdiction other than Singapore. Foreign Shareholders who have registered addresses outside Singapore and who have not provided CDP or the Share Registrar with addresses in Singapore for the service of notices and documents may not participate in the Proposed Rights cum Warrants Issue. No provisional allotment of Rights Shares with Warrants will be made to Foreign Shareholders.

What You Need to Know

The Company has appointed ZICO Capital Pte. Ltd. (“ZICO”) as the issue manager of the Proposed Rights cum Warrants Issue.
Irrevocable Undertaking: A controlling shareholder of the Company, who is also the Executive Director and Chief Executive Officer, has given an undertaking to subscribe for his pro rata entitlement of Rights Shares with Warrants and excess Rights Shares with Warrants.
Use of Proceeds: The estimated net proceeds from the Proposed Rights cum Warrants Issue are approximately S$3,775,000 (assuming none of the Warrants are exercised) or S$5,889,000 (assuming all Warrants are exercised).

Potential Impact on Share Price

The terms of the Proposed Rights cum Warrants Issue could have a significant impact on the share price of Memiontec Holdings Ltd.
Subscription Price: The Irrevocable Undertaking is subject to and conditional upon, amongst others, (a) the Company not losing its free float status; (b) the listing and quotation notice from SGX-ST; (c) shareholders’ approval at the EGM… and (d) all other necessary consents and approvals being obtained. The Undertaking Shareholder shall procure confirmations from financial institutions that he has sufficient financial resources to fulfil his obligations under the Irrevocable Undertaking.
Disclaimer: This article is based on information available to the public and has been compiled for general information purposes only. It does not constitute an investment advice or recommendation. Investors should not rely solely on this article but consult their own financial advisors before making any investment decisions. The information contained in this article is not intended to be a solicitation or recommendation to buy or sell any shares or other securities.

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