Ecobuilt

LOSS-MAKING construction company Ecobuilt Holdings Bhd has decided to cancel its proposed rights issue with free warrants, opting instead to proceed solely with a share capital reduction exercise aimed at eliminating its accumulated losses.

In a filing with Bursa Malaysia today, Ecobuilt said the decision was made after taking into account prevailing market conditions and the board’s view that focusing on the capital reduction would better serve its immediate priorities and streamline regulatory processes.

“The board believes that focusing on the proposed capital reduction would better serve the company’s immediate objectives and streamline the regulatory process,” it said.

Its principal adviser UOB Kay Hian Securities (M) Sdn Bhd has submitted a letter to Bursa Securities to withdraw the earlier listing application dated March 28, 2025, which encompassed both proposals.

Ecobuilt said it will resubmit a revised circular to Bursa Securities in due course, covering only the capital reduction.

The capital reduction, first announced on Jan 28, involves trimming RM35 million from its RM67.96 million share capital.

The move is expected to eliminate RM29.45 million in accumulated losses as of end-August 2024, leaving the company with estimated pro forma retained earnings of RM5 million.

Initially, Ecobuilt had also proposed a rights issue of 420.72 million shares with free detachable warrants, on the basis of one rights share and one warrant for every existing share held.

Assuming an issue price of 2 sen per rights share, the exercise was projected to raise up to RM8.41 million – RM5.49 million of which was earmarked for working capital, RM2.38 million for loan repayments, and the rest for expenses.

No revised capital-raising plan was disclosed in the latest filing. — TMR

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