Sime Darby’s share placement oversubscribed
PETALING JAYA: Sime Darby Bhd’s placement of a 5% stake in the group was oversubscribed, with more than RM6.2 billion’s worth of demand from local and foreign institutional investors for its shares.
After an accelerated book-building process, the group placed out new shares at RM7.45 or a 3% discount to the five-day volume weighted average price of RM7.6796.
The exercise involved the offer of 316.35 million new shares, representing 5% of Sime Darby’s issued and paid-up share capital on Tuesday.
“We are delighted with the strong support from investors for our placement, which shows the trust that the market has in the future of Sime Darby,” president and group chief executive Tan Sri Mohd Bakke Salleh said in a statement yesterday.
The placement exercise will raise a total of RM2.36 billion, which will be used to repay borrowings, fund capital expenditure and working capital as well as to pay for the placement expenses.
“This is a major milestone in Sime Darby’s deleveraging exercise, which will reduce the debt to equity ratio to about 38%,” said Mohd Bakke.
The multinational conglomerate, which has a market capitalisation of RM48.15 billion, is involved in key growth sectors, namely plantation, industrial equipment, motor, property and logistics.
Trading in its shares was suspended from 9am till 10am yesterday for the announcement. The stock closed 2.63% higher at RM7.81 with 6.5 million shares traded.