Blantyre Hotels (BHL) plc rights issue calendar of events shows the hospitality firm is determined to raise the money by November 28 as it offers six shares per each existing share.
In a statement, the joint lead advisers of the firm, Nico Capital Limited and Bridgepath Capital Limited, said the seven billion rights shares have been set at K12.38 per share, representing a discount of 8.3 percent on the market price.
The comprehensive plan shows that the company could raise K62.4 billion for the Lilongwe hotel project by November 28 as it intends the offer period to close on November 22 before listing on the Malawi Stock Exchange (MSE).
“It is expected that the offer period for the rights shares will open on 28 October 2024, and dealings in the nil-paid rights and fully-paid rights on the MSE will commence on the same date,” reads the statement in part.
The statement says the offer period will close on November 22 and the conversion of converted rights shares into the duly subscribed for and fully paid share will be issued and dispatched by November 28 2024.
Meanwhile, Malawi Stock Exchange-listed BHL said apart from the K62.4 billion being raised through rights issue, which means offering extra shares to existing shareholders, about K26.265 billion will be raised through foreign currency-denominated debt to ensure that the importation of construction materials is not hampered.
This means the total remaining financing to complete BHL’s Lilongwe hotel project is K88.665 billion and the firm decided to raise part of it through foreign currency debt to avoid further delays emanating from forex challenges.
In an interview on Tuesday, Stockbrokers Malawi Limited equity investment analyst Kondwani Makwakwa described the company’s issuance of the rights shares as an opportunity for BHL shareholders to maintain their proportional shareholding.
“The rights issue to BHL shareholders gives them an opportunity to maintain their ownership,” he said.
In a separate interview on Tuesday, Minority Shareholders Association of Listed Companies secretary general Frank Harawa said the rights shares will improve the company’s liquidity on MSE.
BHL plc, owners of Protea Hotel by Marriot Blantyre Ryalls, is expected to increase its shareholding in Lilongwe hotel project to almost 70 percent upon completion of the rights issue process.
BHL is 34.34 percent owned by Nico Life Insurance Company Limited, 32.15 percent by Africap LLC, 26.30 percent by Press Trust and 7.21 percent by the public.
