Hot Stock Fiamma jumps 21.3% after it proposes share split, bonus issue

by **Cals** Fri 08 Jan 2016, 00:06

Hot Stock

[size=28]Fiamma jumps 21.3% after it proposes share split, bonus issue

By Yimie Yong / theedgemarkets.com | January 7, 2016 : 11:49 AM MYT

KUALA LUMPUR (Jan 7): Shares of Fiamma Holdings Bhd ([You must be registered and logged in to see this image.] Valuation: 3.00, Fundamental: 2.20) rose as much as 21.26% or 37 sen to RM2.11 today, after the company proposed a one-to-two share split exercise and bonus issue.

At 11.18am, the counter pared gains to trade at RM2.02, up 28 sen or 16.09%, with some 2.18 million shares changing hands, for a market capitalisation of RM293.96 million. It was one of the top gainers on local bourse.

As comparison, FBM KLCI was down 9.33 points or 0.56% at 1,658.88.

In a filing with Bursa Malaysia yesterday, the company said the share split involves the subdivision of every one existing share of RM1 each into two shares of 50 sen each held on an entitlement date to be determined later.

Fiamma said the rationale of the share split proposal is to enhance the marketability and trading liquidity of its shares, making the shares more affordable and appealing to a wider group of investors and enable its existing shareholders to have a larger number of shares, while maintaining their percentage of equity interest.

Fiamma also proposed a bonus issue of up to 177.56 million new subdivided shares, on the basis of one bonus share for every two subdivided shares held on a bonus entitlement date that is also to be determined later.

The rationale for the proposed bonus issue is to reward shareholders and increase the company's capital base.

Furthermore, the company has proposed the establishment of an employee share option scheme (ESOS) of up to 15% of the prevailing issued and paid-up share capital of Fiamma for the eligible employees of the group and its subsidiaries who meet the criteria of eligibility for participation in the scheme.

Fiamma is involved in the distribution and retailing of electrical appliances, sanitary ware, kitchen cabinets, bathroom fittings and healthcare products.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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