In a recent Board of Directors meeting on August 1, 2024, VGI Public Company Limited (SET: VGI) put forth a proposal to expand its registered capital by THB 992.49 million through the offering and allocation of newly issued ordinary shares. This initiative aims to increase the total registered capital to THB 2,370.28 million by issuing up to 9,924,932,301 shares with a par value of THB 0.10 per share.
The proposal includes two key components:
1) Private Placement: VGI plans to offer up to 8,805,480,334 newly issued ordinary shares to specific persons at a price of THB 1.50 per share, totaling up to THB 13,208.22 million.
2) Rights Offering: The company will allocate up to 1,119,451,967 newly issued ordinary shares through the exercise of rights under the VGI-W4 warrants to existing shareholders at no cost.
The Independent Financial Advisor, Avantgarde Capital Company Limited, evaluated the transaction and concluded that the offering of additional common shares via private placement is suitable for the company’s growth and financial flexibility. While the transaction presents certain risks and disadvantages, including dilution effects on existing shareholders and expenses related to the process, the IFA deems the offer price of THB 1.50 per share reasonable compared to the assessed fair value range of THB 1.47 – 1.75 per share.
The IFA also highlighted the potential uses of the funds raised, such as investing in the virtual banking business, supporting existing businesses like media and entertainment, and enhancing entertainment systems in various locations. The entrance of new investors in the private placement will not alter the management control structure, with BTS Group Holdings Public Company Limited (SET: BTS) retaining majority control over VGI.In this regard, shareholders are advised to approve the transaction, considering the rationale, benefits, risks, and the appropriateness of the offering price and terms. The issuance and offering of additional common shares are considered favorable for VGI’s growth and long-term business operations.
