Home MMBIZ News FMI Launches $25 mil Rights Issue

FMI Launches $25 mil Rights Issue

Investment holding firm First Myanmar Investment (FMI) has launched a K25 billion ($25 million) rights issue for the company’s existing shareholders, the proceeds of which will be used to finance growth of the business, the company announced last week.
The company will issue 2.5 million new ordinary shares, priced at K10,000 ($10) each, representing a discount of 20 percent on the current price of shares, the company said.
The shares will be open for subscription by shareholders in accordance with Article 105 (C) of the Myanmar Companies Act from November 25 to January 8 2014. Shareholders will be entitled to subscribe to one new share for every six existing shares held, and are entitled to apply for additional shares.
Shares that are unsubscribed may be open for application to the public on 9 January 2014, in accordance with Article 93 (3) of Myanmar Companies Act. The allotment of the new shares is expected to take place one week after closing of subscription and will entitle their holders to any dividends for the Financial Year 2013-2014. The sale of these new shares is only available for Myanmar nationals.
“Our economy is on the cusp of a significant boom, a period of exponential growth that may not be easily repeated in the decades to come. It is therefore our corporate strategy to proactively expand our existing operations and initiate start-ups in the next two to three years. To do so, we will need to strengthen our capital base and top up our war chest very quickly,” said U Theim Wai, chairman of FMI.
The placement of 2.5 million new shares will be fully underwritten by SPA Myanmar for a fee of 2%. “The assurance of capital ensures that our strategic corporate plans can be implemented on a timely basis”, said U Theim Wai, who is also the Chairman of SPA Myanmar.
Funds from the rights issue will be used in company projects such as in the Thilawa Special Economic Zone, in which FMI is committed to subscribing between five and nine percent of the Myanmar consortium of the site. Other projects include expanding existing operations in tourism and automobile divisions, building up of FMI Air following the granting of a temporary air operator’s certificate, as well as an additional investment in Meeyahta International Hotel Ltd, a 10-acre mixed use property development in downtown Yangon, which will include hotels, office towers, a shopping mall and high-end condominiums.

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