Kikufukudo Biotech (08217) plans to implement capital restructuring and share offering based on the “1 to 3” basis

Zhitong Finance App News, Jufukudo Biotech (08217) issued an announcement. The board of directors recommended the implementation of the share capital restructuring. The share capital restructuring includes the following items:

(1) Share merger, according to which each 5 shares of issued and unissued existing shares with a face value of HK$0.160 per share will be consolidated into 1 consolidated share with a face value of HK$0.800 per share. Any consolidated share piecemeal quota arising from the share merger will not be distributed to the relevant shareholders, but will be aggregated and, if possible, sold, and the proceeds will go to the company;

(2) Capital reduction. According to this, immediately after the share merger comes into effect, the face value of each issued consolidated share will be reduced from HK$0.800 to HK$0.016 by canceling the paid-up share capital of the company of HK$0.784 per issued consolidated share;

(3) Breakdown. According to this, following the capital reduction, the statutory but unissued consolidated shares with a face value of HK$0.800 per share in the company's authorized share capital will be split into 50 statutory but unissued adjusted shares with a face value of HK$0.016 per share;

(4) Following the entry into force of the breakdown, the authorized share capital of the company will be increased from HK$32.668 million to HK$80 million by adding an additional 2,958 billion adjusted shares with a face value of HK$0.016, so the authorized share capital of the company will be HK$80 million, divided into 5 billion adjusted shares with a face value of HK$0.016;

(5) The proceeds from the capital reduction will be used to offset the company's cumulative losses on the effective date of the capital reduction, thereby reducing the company's cumulative losses. The balance received (if any) will be transferred to the Company's distributable reserve account and used for purposes permitted by all applicable laws and the Company's Memorandum and Articles of Association, and in such manner as the Board of Directors deems appropriate.

The board of directors recommended offering shares on the basis of 3 shares offered for each adjusted share held on the record date. The subscription price was HK$0.32 per share to raise a total amount of approximately HK$58 million before deducting expenses by supplying up to 181 million shares to eligible shareholders (assuming that there were no other changes in the number of shares issued on or before the record date, except for those arising from the effective share restructuring). The estimated net proceeds would be approximately HK$55.7 million.

The company plans to use the net proceeds from the share offering for (i) the total outstanding principal and accrued interest of approximately HK$16.2 million; (ii) the working capital of the existing business of approximately HK$39.5 million, including approximately HK$9.5 million for general corporate expenses, approximately HK$20 million for the civil engineering and renovation division, and approximately HK$10 million for the health technology business segment. The stock offering is also expected to improve the company's cash position and strengthen its financial capacity to support its current operations and future business development.