MTCC Board approves Share Split and Rights Issue

Photo: Avas
Photo: Avas

On 08th January 2017, the Board of Directors of MTCC Plc has proposed a share split and a rights issue. Chairman Mr. Ahmed Niyaz said that they are seeking shareholders’ approval for share split, rights issue and the new share issue at the upcoming Extraordinary General Meeting which is scheduled to be held in February 2017.

Share split

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Board of Directors of MTCC propose a 10:1 share split, for every one share this corporate action will result in 10 shares. Value per share of MTCC is currently at MVR 50. The new value per share after the share split will be MVR 5, whereas the net worth of the stock will remain the same. The main objective behind this share split is to increase the liquidity of the company’s shares in the stock market.

Rights Issue

MTCC’s Board is proposing to raise MVR 310,000,000 through the rights issue. MTCC rights issue is structured to ensure that the existing shareholders get the opportunity to subscribe for shares at a discounted price of MVR 62 per share. The existing shareholders are also given the option to transfer/sell the rights allocated to them through the Maldives Stock Exchange during the specified period.

According to Mr. Niyaz, proceeds from the rights issue will be utilized in the Hopper Suction Dredger Project which commenced in the year 2015 and is expected to commence operations in the year 2017.

Chairman of MTCC emphasized on the importance of shareholders participating in the rights issue during the specified time frame, noting that this is the first time a rights issue is offered by any listed company and that this rights issue is offered at a discounted price of MVR 62 per share to the existing shareholders.

He further explained that the reason why MTCC has given priorty for existing shareholder is to minimize the exposure of dilution in the current shareholding structure and that MTCC believes that it is imperative that the current shareholders are given an option to further contribute to the effective realization of company’s future plans before reaching out to outsiders.

Public Issue

Additionally, MTCC wishes to provide the opportunity to the general public to subscribe for shares in case there are any shares unsubscribed for during the rights issue. The offer price for general public is set at MVR 112 per share.

Detailed timelines for the share split, rights issue and public issue will be confirmed after shareholders approval is obtained at the upcoming Extraordinary General Meeting.

CEO of Maldives Stock Exchange Mr. Hassan Manik advices all existing shareholders of MTCC Plc to vigilantly follow all the announcements to be made public following this interim announcement.
Mr. Manik requests all shareholders to seek information from the Maldives Stock Exchange and through licensed brokers if they require further clarification on the procedural details that are due to be announced by MTCC Plc.

According to MTCC, shareholders can seek additional information from their investor relations officer at 3001106.

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