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Shougang Concord Grand plans to raise HK$238.9M in rights issue to fund 3 deals

Shougang Concord Grand (Group) Ltd. plans to raise about HK$238.9 million through a rights offering to partly finance its proposed acquisitions of stakes in three companies.

The company said June 13 that it plans to offer 1,336,096,234 rights shares at 18.7 Hong Kong cents apiece on the basis of 1 rights share for every 2 shares held. The company and its associates intend to subscribe for 1,350,491,315 rights shares.

Meanwhile, Shougang Concord Grand agreed to buy a 43.62% stake in Beijing West Business Factoring Co. Ltd. from Beijing Services New Shougang Venture Capital Investment LLP for 75.3 million yuan, and an 85.71% stake in Shouhua Jingxi Cooperative Innovation (Beijing) Technology Development Co. Ltd. from Jingji Cooperative Development Demonstration Zone (Tangshan) Fund Management Co. Ltd. for 1.5 million yuan.

In addition, a unit of the company agreed to inject additional capital of 200 million yuan in Beijing Jingxi Supply Chain Management Co. Ltd. to increase its shareholding in the company to 70% from 10%.

The company intends to use net proceeds from the rights issue to partly finance the transactions. Any shortfall will be financed through bank financing and/or internal resources of the group.

As of June 13, US$1 was equivalent to 6.40 Chinese yuan.