KSH Plans Convertible Note Issue To Raise Up To $25m

Source : The Business Times, September 22, 2007

Issue includes a greenshoe option of up to $5m to meet excess demand

'The issue is in line with our goal of expanding our capital base with institutional investors.'- Mr Choo

CONSTRUCTION and property group KSH Holdings yesterday proposed to issue up to $25 million in convertible notes to institutional investors.

The issue includes a greenshoe option of up to $5 million to meet excess demand.The net proceeds will be used to fund new capital expenditure requirements and for general working capital.

'We have secured a number of high contract-value construction projects and our existing order books stand at a new high of $405 million, and are expected to cover beyond the financial year ending March 31, 2009,' said KSH managing director Choo Chee Onn.

The issue is 'in line with our long-term goal of expanding our capital base with institutional investors to support our future growth', said Mr Choo, who expects the broader capital base to help KSH better manage capital structure going forward.

The notes will be convertible to new KSH shares at a conversion price of $1.50 per new share, which is at about 26.1 per cent premium to the group's closing share price on Sept 20, 2007.

Related link - http://tinyurl.com/38fqbv
KSH Holdings' news release

The notes, to be denominated in Singapore dollars, will bear a coupon rate of one per cent per year, payable semi-annually. They mature in 2011.

Assuming full exercise of the option and no adjustments to the conversion price, the issue will lead to about 16.67 million new shares. This represents about 18.91 per cent of its existing share capital of over 88.12 million shares.

The notes are expected to be issued on Oct 18, 2007.

DBS Bank is the sole bookrunner and placement agent for the issue.

KSH recently won a contract to construct the prestigious Clifford Hotel, which will be part of the Waterfront 'Garden City by the Bay' development at Marina Bay.

It said its notable projects include One° 15 Marina Club, The Berth By The Cove and The Coast in Sentosa.