Gelonghui, April 8, 丨 China Shangcheng (02330.HK) announced that the company proposes to supply shares at a subscription price of HK$0.15 per share, according to the benchmark of 2 shares offered for each share held, to raise approximately HK$91.6 million by issuing up to 610 million shares to eligible shareholders. The shares to be issued under the share offering terms are equivalent to 200.0% of the existing issued share capital; and the issued share capital expanded by approximately 66.67% through allotment.
On April 8, 2024, the company entered into a placement agreement with the placement agent. According to this, the placing agent has agreed to induce the undertaker to subscribe for unsubscribed shares according to the best effort criteria.
In addition to offering shares, directors have also explored other debt or equity financing options, such as bank loans, placements, or public offerings. The directors noticed that bank loans provided very limited credit lines and required collateral. If the relevant loans can be obtained, the expected size of bank loans required by the Group is likely to incur additional interest costs and put further pressure on the Group's liquidity and profitability. Placing new shares will dilute the interests of existing shareholders, and they will have no opportunity to participate in the placement. Unlike a public offering, a share offering enables shareholders to sell unpaid shares on the market. The share offering will give eligible shareholders an opportunity to maintain their respective shareholding interests in the company and continue to participate in the future development of the Group. After considering the other plans mentioned above, the directors believe that offering shares is in the overall best interests of the company and shareholders, and that offering shares is an appropriate funding method to strengthen the company's capital base, thereby supporting the company's continued development and business growth, while allowing eligible shareholders to maintain their shareholding ratio equal to the company's shareholding ratio.