BCPG shares tumble over capital increase plan
Shares of power giant BCPG on Friday closed at Bt12.80 per share, down Bt1.70 or 11.72 per cent, after the company announced an increase in capital by offering 1.3 billion additional common shares to specific investors, experts said.
Bundit Saphianchai, BCPG president, informed the Stock Exchange of Thailand that the company's board of directors had approved increasing its capital to Bt16.508 billion from the previous Bt10 billion by launching 1.301 billion additional common shares at the par value of Bt5 per share. The company aimed to inform shareholders at an extraordinary general meeting on October 7.
He explained that not more than 250 million additional shares will be offered to existing shareholders at the ratio of one new share for 8 shares at Bt11.50 per share, while the company will grant BCPG -W1 and BCPG -W2 warrants to existing shareholders without any charges.
"The conpany will grant 89.3 million units each of BCPG -W1 and BCPG -W2 warrants at a ratio of 2.80 additional shares per unit. Existing investors can use one warrant per additional share at Bt8 per share. The terms of the BCPG -W1 and BCPG -W2 warrants are two years and three years, respectively," he said.
He further explained that not more than 391.5 million additional shares will be offered to Pilgrim Partners Asia and Capital Asia Investments equally at Bt11.50 per share, while the company will grant BCPG -W3 warrants to those companies without any charges.
"BCPG -W3 warrants totalling 178.6 million units will be granted at a ratio of 2.1924 additional shares per unit. Existing investors can use one warrant per additional share at Bt8 per share. The term of the BCPG -W3 warrants are one year," he said.
He said that not more than 283 million additional shares will be offered to a limited group of investors at market price during the offering period.
"Meanwhile, not more than 357.2 million shares were for BCPG -W1, BCPG -W2 and BCPG -W3 warrant exercises and not more than 20 million shares will be issued to company directors, executives and employees," he said.
He added that this move aimed to raise capital for business expansion, such as investment, development, and acquisition of power plants under the company's investment plan, as well as repaying debts to financial institutions.
An analyst at Asia Plus Securities said BCPG's announcement to increase capital had caused the share price to drop in the short term because the share volume will increase to 3.3 billion shares, up 62 per cent from the current 1.99 billion shares.
"We expect that this negative sentiment will plunge the share price at least 12-15 per cent," he said.
He added that the securities company has cut its base value forecast at the end of this year to Bt11.90 per share from the previous Bt19.70 per share, advising investors to speculate profit from other shares due to such factors.
