TTA announces proposed rights offering

Bangkok: Thoresen Thai Agencies today announced plans for a capital increase to raise up to THB4.1bn via a rights offering (RO). The announcement follows a successful, oversubscribed RO and warrant issue concluded in March 2013. TTA plans to use the proceeds to invest in its key subsidiaries and associate companies, taking advantage of market opportunities in dry bulk shipping, oil & gas services and infrastructure.

Shareholders will be entitled to exercise their rights by subscribing to three newly issued shares at a price of THB 14 per share for every 10 existing shares they own. In addition, free warrants will be issued to shareholders who subscribe for new shares at a ratio of one warrant to three newly subscribed shares. Each warrant can be converted into one common share at an exercise price of THB 18.5 within 36 months of the warrant issuance. Shareholders will be entitled to subscribe for excess rights, which will be capped at 50% of their total shareholding at 7 February 2014, and oversubscribed allocations will be provided based on percentage of shareholding.

At THB 14 per share, the RO price represents a discount of approximately 16.7% on TTA’s weighted average share price over the last 15 days. Meanwhile, the exercise price for TTA-W4 reflects a 10% premium of the 15-day weighted average, as a result of a longer exercise window and the improved prospects for the company in both the short and medium term.

Chalermchai Mahagitsiri, TTA's incoming president and ceo, said, "As a holding company, TTA must remain agile in order to capitalise on market opportunities across any one of its businesses. With vessels still at bottom-of-the-cycle prices, analysis by our board and management has concluded that a strong opportunity remains to expand the Thoresen Shipping Singapore Pte fleet in expectation of a recovery in the short to medium term. At the same time, we see strong impetus for additional investment in Mermaid Maritime as exploration and production activity continues to ramp up in many of our key markets. Finally, our Vietnam investments, from the deep water port at Phu My, to a fast-growing fertiliser and warehouse business, have all performed tremendously, opening the door to further investment.” [28/11/13]

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