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Tuesday, March 24, 2009

Shareholders Approve TMI's RM5.25 Billion Rights Issue Plan 24 Mar 2009

TM International Bhd has received shareholder approval for its plan to raise RM5.25 billion via a fully renounceable rights issue.

TMI president and group chief executive officer, Datuk Seri Jamaludin Ibrahim,said the rights issue would make the group more agile financially.

"It places us on a firmer footing to weather the volatility of the current economic conditions," he told reporters after the group's extraordinary general meeting (EGM) here today.
The pricing for the rights issue has been fixed at RM1.12 per share on the basis of five rights shares for every four existing TMI shares held.
TMI is looking to announce the entitlement date for the rights issue shortly and complete the process by the second quarter of this year.

Under the proposal, the proceeds after paying for all expenses in relation to the proposed rights issue, would be used for the repayment of up to RM5.15 billion of TMI's borrowings while the balance is for the group's working capital purposes.
On the portion of the RM4 billion owed to TM, under the demerger agreement, the group is required to repay it by April 25.

"It is well on track," Jamaluddin said. The group chief financial officer/executive director Datuk Yusof Annuar Yaacob said the group would pare down that debt earlier by bank borrowings and subsequently use the rights issue proceeds for bank borrowings.

During the EGM that lasted five hours, there were eight resolutions passed by shareholders which primarily related to three key matters -- the rights issue, a change of name and a long term incentive scheme in the form of employee share options.

On another note, TMI will change its name to Axiata Bhd effective from mid April. It will also undergo a logo change.

The new name will give TM International a different identity to reflect the company's businesses and strategy, its chairman Tan Sri Azman Mokhtar said.
He said the new name and corporate logo would be launched on April 15.

The incremental cost due to the name change is between RM5 million-RM10 million against a revenue base of RM11 billion, he added.

"We have an annual advertising budget of RM500 million as a group and the revenue base of the group is RM11 billion. The incremental cost of the name change is in addition to that budget," Azman said.

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