KNM proposes to cut share par value by 50%

by **Cals** Tue 28 Jan 2014, 01:49

Business & Markets 2014

Written by Ho Wah Foon of theedgemalaysia.com

Monday, 27 January 2014 19:42

KUALA LUMPUR (Jan 21): KNM Group Bhd has proposed to undertake a par value reduction via the cancellation of RM0.50 of the par value of every existing share of RM1.00 each in the company.

This was one of the three corporate proposals announced today. The other two concerned the amendment of its constitution and the setting up of an employees' share option scheme.

The issued and paid-up share capital of KNM is RM1,490,013,252 comprising 1,490,013,252 ordinary shares of RM1.00 each, including 23,271,275 treasury shares credited as fully paid-up and 488,920,659 outstanding warrants 2012/2017 as of today.

“The proposed par value reduction will give rise to a credit of RM745,006,626 which will be credited to the share premium reserve account of the company and may be utilised in such manner as the board deems fit,” said the company in a filing with Bursa Malaysia.

As at 31 December 2012, KNM’s share premium account amounted to RM16.71 million.

On the rationale for the exercise, KNM noted that as at Jan 24, the closing price of KNM share was RM0.565, which was at a discount of 43.5% to the existing par value of RM1.00 per share.

“The current market price of KNM shares is therefore not conducive for KNM to embark on any fund-raising exercise and/or corporate exercises involving issuance of new shares.

“Accordingly, the proposed par value reduction will provide the company with greater flexibility to raise funds and to implement future corporate proposals which entail the issuance of new shares.”