1. Healthcare

TIGER SYNERGY BERHAD (“TSB” OR THE “COMPANY”)
PROPOSED PRIVATE PLACEMENT OF UP TO TEN PERCENT (10%) OF THE ISSUED AND PAIDUP SHARE CAPITAL OF TSB (“PROPOSED PRIVATE PLACEMENT”)
1.
INTRODUCTION
On behalf of the Board of Directors of TSB (“Board”), RHB Investment Bank Berhad (“RHBIB”)
wishes to announce that the Company proposes to undertake a private placement of up to ten
percent (10%) of the issued and paid-up share capital of the Company, to investors to be
identified at an issue price to be determined by the Board and announced later (“Proposed
Private Placement”).
The Company had obtained the approval from its shareholders at the last annual general
meeting (“AGM”) convened on 29 December 2014, authorising the Board to issue new ordinary
shares of RM0.20 each in TSB (“TSB Shares”) not exceeding ten percent (10%) of the issued
and paid-up share capital of the Company pursuant to Section 132D of the Companies Act, 1965
(“Act”). The approval shall continue to be in force, unless revoked or varied by the Company at a
general meeting, until the conclusion of the next AGM of the Company, which is expected to be
held after the completion of the Proposed Private Placement.
Further details on the Proposed Private Placement are set out in the following sections.
2.
DETAILS OF THE PROPOSED PRIVATE PLACEMENT
2.1
Size of the Proposed Private Placement
The Proposed Private Placement will entail the issuance of up to 138,294,026 TSB
Shares, representing ten percent (10%) of the issued and paid-up share capital of TSB
to investors to be identified at a later date (“Placement Shares”).
As at 20 January 2015, being the latest practicable date prior to the date of this
announcement (“LPD”), the issued and paid-up share capital of TSB is RM154,828,040
comprising 774,140,200 TSB Shares. In addition, as at the LPD, the Company has
41,346,450 outstanding Warrants 2010/2015 (“Warrant A”) and 387,070,100
outstanding Warrants 2013/2018 (“Warrant B”) (collectively, the “Warrants”) and up to
180,383,512 employee share option scheme (“ESOS”) to be granted and exercised.
The maximum number of Placement Shares to be issued pursuant to the Proposed
Private Placement would depend on the issued and paid-up share capital of the
Company, after taking into consideration the number of outstanding Warrants being
exercised and the ESOS options being granted and exercised prior to the
implementation of the Proposed Private Placement. For illustrative purposes, assuming
that all 428,416,550 Warrants are exercised and 180,383,512 ESOS options are granted
and exercised prior to the implementation of the Proposed Private Placement, the
resultant issued and paid-up share capital of TSB may increase up to RM276,588,052
comprising up to 1,382,940,262 TSB Shares. As such, a total of up to 138,294,026
Placement Shares representing ten percent (10%) of the enlarged issued and paid-up
share capital of TSB may be issued pursuant to the Proposed Private Placement.
The actual number of Placement Shares to be issued pursuant to the Proposed Private
Placement will be determined at a later date. Subject to prevailing market conditions, the
Proposed Private Placement may be implemented in one (1) or more tranches within six
(6) months from the date of approval of Bursa Malaysia Securities Berhad (“Bursa
Securities”) for the Proposed Private Placement or any extended period as may be
approved by Bursa Securities, depending on the timing of identification of the placee(s)
and investors’ interest at the point of implementation.
Page 1 of 10
2.2
Basis of determining at the issue price and justification of the Placement Shares
The Placement Shares will be issued based on a discount, if any, of not more than ten
percent (10%) to the five (5)-day volume weighted average price (“VWAP”) of TSB
Shares immediately preceding the price-fixing date, to be determined by the Board after
obtaining all the relevant approvals for the Proposed Private Placement. In any case, the
issue price of the Placement Shares will not be lower than the par value of the TSB
Shares of RM0.20 each.
As the Proposed Private Placement may be implemented in one (1) or more tranches
within six (6) months from the date of approval of Bursa Securities for the Proposed
Private Placement or any extended period as may be approved by Bursa Securities,
subject to the prevailing market conditions and investors’ interest at the point of
implementation, there could potentially be several price fixing dates and issue prices.
For illustrative purposes only, the issue price of the Placement Shares is indicatively set
at RM0.20 per Placement Share, which is priced at the par value of the TSB Shares and
represents a premium of approximately RM0.065 or 48.15% from the five (5)-day VWAP
of TSB Shares up to and including 28 January 2015 of RM0.135.
2.3
Allocation to placees
The Placement Shares will be placed out to independent third (3rd) party investors to be
identified at a later date, where such investor(s) shall be person(s) who/which qualify
under Schedule 6 and 7 of the Capital Markets and Services Act, 2007.
In accordance with Paragraph 6.04(c) of the Main Market Listing Requirements of Bursa
Securities (“Listing Requirements”), the Placement Shares will not be placed to the
following parties:
2.4
(a)
the director, major shareholder, chief executive of TSB or interested person
connected with the director, major shareholder or chief executive of TSB; and
(b)
nominee corporations, unless the names of the ultimate beneficiaries are
disclosed.
Ranking of the Placement Shares
The Placement Shares shall, upon allotment and issue, rank pari passu in all respects
with the existing TSB Shares, save and except that the Placement Shares will not be
entitled to any dividend, rights, allotment and/or other distribution that may be declared,
made or paid to the shareholders, the entitlement date of which is prior to the date of
allotment of the Placement Shares.
2.5
Utilisation of proceeds
The Company is unable to determine the actual amount of proceeds to be raised from
the Proposed Private Placement at this juncture as the amount to be raised will depend
on, amongst others, the actual issue price and the actual number of Placement Shares
to be issued.
For illustrative purpose, the effects of the Proposed Private Placement shall be based on
two (2) scenarios as follows:
Page 2 of 10
Minimum
Scenario
:
Assuming that none of the outstanding Warrants are exercised and
none of the ESOS options are granted and exercised prior to the
implementation of the Proposed Private Placement and the
Placement Shares are fully placed out
Maximum
Scenario
:
Assuming that all of the outstanding Warrants are exercised and the
ESOS options are fully granted and exercised prior to the
implementation of the Proposed Private Placement and the
Placement Shares are fully placed out
For illustrative purposes, based on an indicative issue price of RM0.20 per Placement
Share and the issuance of up to 138,294,026 Placement Shares, the Proposed Private
Placement is expected to generate gross proceeds of approximately RM27,658,805.
The proceeds raised are expected to be utilised in the manner set out below:-
Details of utilisation
Working capital
(1)
Property development
expenditure (2)
Estimated expenses
Minimum
Scenario
Maximum
Scenario
RM’000
RM’000
5,054
6,258
Within twelve (12) months from
the date of completion of the
Proposed Private Placement
10,054
21,026
Within twelve (12) months from
the date of completion of the
Proposed Private Placement
375
375
Within one (1) month from the
date of completion of the
Proposed Private Placement
15,483
27,659
(3)
Total
Estimated timeframe for
utilisation of proceeds
Notes:
(1)
Working capital includes but not limited to the day-to-day operations and general expenses of TSB and its
subsidiaries (“TSB Group”).
The details of the working capital will be utilised as follows:
Minimum
Scenario
RM’000
Maximum
Scenario
RM’000
895
1,584
Staff related expenses (including salary, allowances and
payment to Employment Provident Fund and Social Security
Organisation)
3,159
3,474
Other operating and marketing expenses
1,000
1,200
Total
5,054
6,258
Details of utilisation
General expenses (including utility charges)
(2)
The proceeds from the Proposed Private Placement are intended to be utilised for property development
expenditures, which would include payments to contractors, suppliers and consultants, mobilisation fees
and also contribution payments (which include, amongst others, charges for the provision of the supply of
electricity and water, land conversion or land alienation premium and building plan fees and development
charges) to the relevant authorities as well as applications for permits and licenses in respect of property
development activities.
The proceeds from the Proposed Private Placement have not been allocated for any specific projects at
this juncture to provide flexibility to TSB in determining the use of the proceeds so long as the proceeds
will be utilised for the TSB Group’s property development expenditures.
Page 3 of 10
(3)
The estimated expenses of RM375,000 consist of professional fees, fees payable to authorities,
placement management fee and placement commission and other miscellaneous expenses to be incurred
in relation to the Proposed Private Placement. Any variation in the actual amount of expenses will be
adjusted to/from the amount allocated for working capital portion.
The amount is expected to be utilised within twelve (12) months from the date of
completion of the Proposed Private Placement. Pending utilisation of proceeds from the
Proposed Private Placement will be placed with financial institutions or short term money
market instruments.
2.6
Listing of and quotation for the Placement Shares
An application will be made to Bursa Securities for the listing of and quotation for the
Placement Shares to be issued pursuant to the Proposed Private Placement on the Main
Market of Bursa Securities.
3.
RATIONALE FOR THE PROPOSED PRIVATE PLACEMENT
After due consideration of the various methods of fund raising, the Board is of the view that the
Proposed Private Placement is the most appropriate avenue of fund raising as it:
(i)
enable TSB to raise funds for its working capital requirements without incurring interest
costs, as compared to bank borrowings;
(ii)
is the most expeditious way of raising funds from the capital market as opposed to other
forms of fund raising; and
(iii)
increases the size and strength of the Company’s shareholders’ funds and potentially
increases the liquidity and marketability of TSB Shares on the Main Market of Bursa
Securities.
The Company had on 31 December 2013 completed a rights issue exercise and raised RM77.41
million whereby, the Company has as at the LPD utilised RM67.41 million of the proceeds raised
from the rights issue exercise. The remaining RM10.00 million raised from the rights issue
exercise is earmarked for property development expenditure and land acquisition which is
envisaged to be fully utilised by within eleven (11) months. Notwithstanding the aforesaid, the
Board has decided to raise additional funds vide the Proposed Private Placement to raise further
funds for working capital, property development expenditure and to cater for additional working
capital requirements costs due to amongst others, the rising material costs and higher labour
costs due to the goods and services tax.
4.
EFFECTS OF THE PROPOSED PRIVATE PLACEMENT
The proforma financial effects of the Proposed Private Placement on the issued and paid-up
share capital, net asset (“NA”) and gearing, earnings and substantial shareholdings of TSB
Group are set out below:
Page 4 of 10
4.1
Issued and paid-up share capital
For illustrative purposes, the proforma effects of the Proposed Private Placement on the
issued and paid-up share capital of TSB are as follows:
Minimum Scenario
Existing as at the LPD
Shares to be issued upon full
exercise
of
the
outstanding
Warrants
Shares to be issued upon the
ESOS options are fully granted and
exercised
Shares to be issued pursuant to the
Proposed Private Placement
Enlarged issued
share capital
and paid-up
Maximum Scenario
No. of TSB
Shares
RM
No. of TSB
Shares
RM
774,140,200
154,828,040
774,140,200
154,828,040
-
-
428,416,550
85,683,310
774,140,200
154,828,040
1,202,556,750
240,511,350
-
-
180,383,512
36,076,702
774,140,200
154,828,040
1,382,940,262
276,588,052
77,414,020
15,482,804
138,294,026
27,658,805
851,554,220
170,310,844
1,521,234,288
304,246,857
THE REST OF THE PAGE IS INTENTIONALLY LEFT BLANK
Page 5 of 10
4.2
NA and gearing
Based on the latest audited consolidated financial statements of TSB as at 30 June 2014,
the proforma effects of the Proposed Private Placement on the consolidated NA and
gearing are as follows:
Minimum Scenario:
Audited as at 30 June 2014
After the Proposed Private Placement
RM
RM
154,828,040
170,310,844
15,565,991
15,565,991(1)
66,561
66,561
37,181,275
37,181,275
-
-
Accumulated loss
(37,399,433)
(37,774,433)
Shareholders’ funds/NA
170,242,434
185,350,238
No. of TSB Shares
774,140,200
851,554,220
0.22
0.22
6,884,930
6,884,930
0.04
0.04
Share capital
Share premium
Revaluation reserve
Warrant reserves
Other reserves
NA per share
Total borrowings
Gearing
(2)
Notes:
(1)
The indicative issue price for the Placement Shares is based on the par value of RM0.20 per TSB Share.
(2)
After deducting the estimated expenses for the Proposed Private Placement of RM375,000.
THE REST OF THE PAGE IS INTENTIONALLY LEFT BLANK
Page 6 of 10
Maximum Scenario:
Share capital
Share premium
Revaluation reserve
Warrant reserves
Other reserves
Proforma I
Proforma II
Proforma III
After full exercise
of the outstanding
Warrants
After Proforma II
and the Proposed
Private Placement
Audited as at
30 June 2014
After Proforma I
and after the
ESOS options are
fully granted and
exercised
RM
RM
RM
RM
154,828,040
240,511,350
276,588,052
304,246,857
15,565,991
(1)
52,747,266
66,561
66,561
66,561
66,561
37,181,275
(1)
-
-
-
-
(3)
52,747,266
-
-
(2)
52,747,266
(37,774,433)
Accumulated loss
(37,399,433)
(37,399,433)
(37,399,433)
Shareholders’ funds/NA
170,242,434
255,925,744
292,002,446
319,286,251
No. of TSB Shares
774,140,200
1,202,556,750
1,382,940,262
1,521,234,288
0.22
0.21
0.21
0.21
6,884,930
6,884,930
6,884,930
6,884,930
0.04
0.03
0.02
0.02
NA per share
Total borrowings
Gearing
Notes:
(1)
The warrant reserve of RM37,181,275 was deducted pursuant to the exercise of Warrants.
(2)
The indicative issue price for the Placement Shares is based on the par value of RM0.20 per TSB Share.
(3)
After deducting the estimated expenses for the Proposed Private Placement of RM375,000.
4.3
Earnings and earnings per share
The Proposed Private Placement is not expected to have any material effect on the
earnings of TSB, except that the earnings per share of TSB will be proportionately
diluted due to the increase in number of TSB Shares as a result of the issuance of
Placement Shares pursuant to the Proposed Private Placement.
4.4
Existing convertible securities
As at the LPD, TSB has outstanding of 41,346,450 Warrants A, 387,070,100 Warrants B
and 180,383,512 ESOS options.
4.5
Substantial shareholders’ shareholdings
The proforma effects of the Proposed Private Placement on the substantial shareholders’
shareholdings as at the LPD are set out below:
Page 7 of 10
Minimum Scenario:
As at the LPD
Shareholders
Dato’ Tan Wei Lian
Tan Lee Chin
Datin Sek Chian Nee
Direct
No. of
TSB Shares
134,165,700
18,382,000
23,432,000
%
17.33
2.37
3.03
Indirect
No. of
TSB Shares
41,814,000(1)
(2)
134,165,700
(3)
134,165,700
%
5.40
17.33
17.33
After the Proposed Private Placement
Direct
Indirect
No. of
No. of
TSB Shares
%
TSB Shares
134,165,700
15.76
41,814,000(1)
(2)
18,382,000
2.16
134,165,700
(3)
23,432,000
2.75
134,165,700
%
4.91
15.76
15.76
Notes:
(1) Deemed interested by virtue of the interest of his sister, Tan Lee Chin and his spouse, Datin Sek Chian Nee pursuant to Section 6A of the Act.
(2) Deemed interested by virtue of the interest of her brother, Dato’ Tan Wei Lian pursuant to Section 6A of the Act.
(3) Deemed interested by virtue of the interest of her spouse, Dato’ Tan Wei Lian pursuant to Section 6A of the Act.
THE REST OF THE PAGE IS INTENTIONALLY LEFT BLANK
Page 8 of 10
Maximum Scenario:
As at the LPD
Shareholders
Dato’ Tan Wei Lian
Tan Lee Chin
Datin Sek Chian Nee
Shareholders
Dato’ Tan Wei Lian
Tan Lee Chin
Datin Sek Chian Nee
Direct
No. of
TSB Shares
134,165,700
18,382,000
23,432,000
%
17.33
2.37
3.03
Indirect
No. of
TSB Shares
(1)
41,814,000
(2)
134,165,700
134,165,700(3)
%
5.40
17.33
17.33
Proforma II
After Proforma I and after the ESOS options are fully
granted and exercised
Direct
Indirect
No. of
No. of
TSB Shares
%
TSB Shares
%
(4)
(1)
169,848,251
12.28
81,694,845
5.91
(4)
(2)
40,133,320
2.90
169,848,251
12.28
(4)
41,561,525
3.01
169,848,251(3)
12.28
Proforma I
After full exercise of the outstanding Warrants
Direct
Indirect
No. of
No. of
%
%
TSB Shares
TSB Shares
(1)
151,809,900
12.62
45,618,143
3.79
(2)
22,094,969
1.84
151,809,900
12.62
23,523,174
1.96
151,809,900(3)
12.62
Proforma III
After Proforma II and the Proposed Private
Placement
Direct
Indirect
No. of
No. of
TSB Shares
%
TSB Shares
%
(4)
(1)
169,848,251
11.17
81,694,845
5.37
(4)
(2)
40,133,320
2.64
169,848,251
11.17
(4)
41,561,525
2.73
169,848,251(3)
11.17
Notes:
(1) Deemed interested by virtue of the interest of his sister, Tan Lee Chin and his spouse, Datin Sek Chian Nee pursuant to Section 6A of the Act.
(2) Deemed interested by virtue of the interest of her brother, Dato’ Tan Wei Lian pursuant to Section 6A of the Act.
(3) Deemed interested by virtue of the interest of her spouse, Dato’ Tan Wei Lian pursuant to Section 6A of the Act.
(4) Assuming the following substantial shareholders who are also eligible employee, as well as persons connected to them would be allocated 10% of the number of shares to be issued
under the ESOS scheme and the options were fully granted and exercised.
Name
Directors/Substantial shareholders
Dato’ Tan Wei Lian
Tan Lee Chin
Entitlement of the ESOS options under the ESOS (No. of
ESOS options)
18,038,351
18,038,351
Human Resource Manager
Datin Sek Chian Nee
18,038,351
Page 9 of 10
5.
APPROVALS REQUIRED
The Proposed Private Placement is subject to and conditional upon the following approvals being
obtained:
(i)
Bursa Securities for the listing of and quotation for the Placement Shares on the Main
Market of Bursa Securities; and
(ii)
Approvals of any relevant authorities and/or parties, if required.
The Company had obtained approval from its shareholders at the last AGM convened on 29
December 2014, authorising the Board to issue new TSB Shares not exceeding ten percent
(10%) of the issued and paid-up share capital of the Company pursuant to Section 132D of the
Act. The approval shall continue to be in force, unless revoked or varied by the Company at a
general meeting, until the conclusion of the next AGM of the Company, which is expected to be
after the completion of the Proposed Private Placement.
The Proposed Private Placement is not conditional upon any other corporate exercise
undertaken or to be undertaken by the Company.
6.
INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSONS CONNECTED
None of the Directors, major shareholders of TSB and/or persons connected to them, as defined
in the Listing Requirements, have any interest, either direct or indirect, in the Proposed Private
Placement.
7.
DIRECTORS’ RECOMMENDATION
The Board having considered all aspects of the Proposed Private Placement, including the
rationale and its financial effects to TSB, is of the opinion that the Proposed Private Placement is
in the best interests of the Company.
8.
PRINCIPAL ADVISER
RHBIB has been appointed by the Company to act as the Principal Adviser for the Proposed
Private Placement.
9.
ESTIMATED TIMEFRAME FOR SUBMISSION TO AUTHORITIES AND COMPLETION
The applications to the relevant authorities, in particular Bursa Securities, will be made within one
(1) month from the date of this announcement. Barring unforeseen circumstances, the Proposed
rd
Private Placement is expected to be completed by the third (3 ) quarter of calendar year 2015.
This announcement is dated 29 January 2015.
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