Indonesia-listed food producer Tiga Pilar Sejahtera Food (TPS Food) is planning to raise around IDR 314 billion ($22.5 million) through a private placement exercise, according to its stock exchange filing.
TPS Food will issue a total of 1.57 billion new shares priced at IDR 200 apiece, which will be absorbed by a new investor. The new shares issued will represent 32.77 per cent of the company’s total issued and paid capital.
The completion of the private placement process is subject to shareholders’ approval. The company’s EGM is scheduled for August 9, 2019.
Following the transaction, the ownership of existing shareholders will be diluted around 32.77%. Currently, JPMB NA RE-Trophy Investors I Ltd holds 9.32%, BBH Luxembourg S/A Fidelity FD SICA V 7.98%, Trophy 2014 Investor Ltd 9.09%, Primanex Limited 5.38% and Morgan Stanley & Co. LLC-Client Account 6.52% while the remaining is held by public investors.
The proceeds from the private placement will be used to strengthen the company’s capital as well as its financial structures. TPS Food expects to lower its debt to equity ratio, and it will receive additional capital to develop the business, as well as to increase the liquidity of its stock trading on the IDX.