Property developer PT Kawasan Industri Jababeka Tbk (KIJA) is proposing a Rp1.5 trillion rights issue as well as fund raising of Rp1.28 trillion or US$150 million via the issuance of exchangeable notes or high-yield notes.
Regarding to the rights issue, it will be 71% of Jababeka's yesterday market capitalization at Rp2.11 trillion, which is too much dilution.
Corporate Secretary Muljadi Suganda, as quoted by Bisnis Indonesia today, said the company will use the fund raising to underpin its expansion to develop dry port, power plant, and proposed acquisitions.
"For details, we are seeking shareholders approval scheduled on September 20," he said. Muljadi said the rights issue proceed will be used by Jababeka to acquire 100% stake in PT Banten West Java Tourism Development and PT Tanjung Leisure Industry.
A reputable banker said it is not too easy for Jababeka to proceed the raising fund as the company is too small. In the first half of this year, Jababeka's net profit was Rp51.6 billion or Rp103.2 billion in for the full year of 2011. "I don't think Jababeka could raise all the money," the banker told Insider Stories recently.
Disclosure: No position at the stock mentioned above.
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