Beleaguered IEC persists with ordinary share subscription

International Engineering Plc (IEC) informed the Stock Exchange of Thailand (SET) yesterday the company will proceed with the ordinary share subscription as scheduled in compliance with the law and shareholders’ resolutions.

“The company ensures the proceedings, arrangement and organisation of the voting process for each agenda item at the shareholders’ meeting followed the rules. We have been operating in accordance with the laws, objectives and company’s regulations, as well as the resolutions of the extraordinary general meeting of shareholders, dated Oct 20,” said IEC in its statement filed to the SET.

In addition to appointing six new directors, the meeting resolved to approve the allotment and offering of 203.6 billion new ordinary shares at a par value of 0.01 baht.

The shares will be allotted and offered to existing shareholders via a rights offering at a subscription ratio of one existing share to one new ordinary share at an offer price of 0.0125 baht each.

The subscription and offering period is scheduled to be held from Nov 23-29.

“The company and the majority of shareholders have acknowledged the severe lack of financial liquidity and realised if the company is unable to increase its capital, this could significantly affect the company’s business operations and survival,” the statement said.

Earlier, the SET demanded that IEC’s board of directors clarify why they did not postpone the share subscription and payment period as uncertainty remained over the company’s ability to register for a capital increase.

“Since the company does not postpone the share subscription period while there is uncertainty on the ability to register for a capital increase, there will be an impact on shareholders who [plan to] subscribe for new ordinary shares since IEC may be unable to submit the application for the listing of new ordinary shares to the SET,” said the SET statement.

IEC has informed the SET that the registrar remains under consideration since some shareholders have objected to a capital increase.

If the registrar rejects the registration procedure, IEC said it will refund the share subscription payment within 30 days after rejection.

If IEC is unable to refund the share subscription payment to the subscribers within the specified period, the company will pay interest to the subscribers based on Siam Commercial Bank’s deposit interest rate.

The interest paid to subscribers will be calculated after the 15-day period following the offering’s closing date.

“But for the period where the result of the registration is not yet known, the subscription payment paid by subscribers will be deposited in the company’s saving account,” said the IEC statement.

Meanwhile, the Securities and Exchange Commission (SEC) has instructed IEC’s board committee to act with caution and accountability to ensure that the shares can be redeemed to shareholders in case the company cannot register the capital increase.

“If damage occurs to shareholders who subscribe to the capital increase, the SEC will proceed strictly [in probing IEC],” said the SEC.