Fitters ... Jul10

Its MD Datuk Richard Wong’s, the single largest shareholder in the fire fighting equipment manufacturer had raised his warrant holdings in FDB significantly after increasing his equity interest to over 30% of the company’s paid up capital.

Wong and his family members have a combined interest of 32.82% in FDB – close to the 33% threshold that would trigger a GO for the remaining shares in the company. Its MD said that he acquired more warrants in the company as he does not intend to trigger the GO threshold.

The money derived from the conversion of the warrants could be ploughed back into FDB to finance the company’s future ventures, especially in the area of renewable energy. It has broadened its income base with other ventures, including construction, property development and renewable energy.

As a result of the warrants purchased, its MD owns 28.63 million warrants or 43.65% of the 65.58 million units outstanding. The conversion ratio of 1:1 at a strike price of 80 sen. As at April 2010, none of the outstanding warrants had been executed.

Companies issue warrants to raise money.

Fitters’ net assets per share is 92 sen as at March 2010.

The enlarged share capital base includes new units from a private placement of 13.12 million new FDB shares at 51 sen each to raise RM6.69 million. The exercise took place in March 2010.

Assuming full exercise of the 65.58 million outstanding warrants and including the bonus shares to be issued, the company’s share base is expected to more than double to 314.78 million shares.

It needs to expand its share capital base to venture into bigger things especially renewable energy.

It plans to attract institutional investors in the near term. Its current shareholders include Lembaga Kumpulan Wang Kawasan Konsesi Hutan and the Sarawak Timber Industry development Corp with 1.2% and 0.61% respectively.