TrickleStar Limited, a Singapore-based company, has announced plans for a renounceable, non-underwritten rights issue to raise approximately S\$0.9 million in net proceeds. This move is aimed at enhancing the Group’s financial flexibility and supporting future growth opportunities, according to the company’s latest regulatory filing.

Key Highlights of the Rights Issue

• Issue Price: The Rights Shares will be offered at S\$0.015 per share, representing a significant discount of approximately 39.5% to the volume-weighted average price of S\$0.0248 per share and 42.3% to the closing price of S\$0.0260 on December 9, 2024.
• Allotment Ratio: Shareholders will be entitled to subscribe for four (4) Rights Shares for every five (5) existing shares held as of the Record Date. Fractional entitlements will be disregarded.
• Non-Underwritten Offer: The rights issue is non-underwritten, enabling TrickleStar to save on underwriting fees.
• Maximum Scenario: If fully subscribed, up to 67,426,073 new shares will be issued, which will increase the company’s share capital by approximately 80% of its current issued shares.

Purpose and Use of Proceeds

The company plans to allocate the entire net proceeds of S\$0.9 million to general working capital purposes. This includes operational expenses, corporate administrative costs, and other payables related to the Group’s business activities.

Pending deployment, the funds will be held in banks, invested in short-term money markets, or utilized in other short-term investments.

Rationale for the Rights Issue

Despite the current sufficiency of working capital, TrickleStar’s Board believes the rights issue will strengthen the Group’s financial base, enabling it to seize strategic growth opportunities and improve financial performance. By pricing the shares at a discount, the company aims to encourage participation from existing shareholders who wish to maintain their equity stake.

Conditions and Key Shareholder Information

• The rights issue is subject to approval from the Singapore Exchange Securities Trading Limited (SGX-ST) for the listing and quotation of the Rights Shares.
• The company has not secured any undertakings from major shareholders to subscribe to the rights issue. Shareholders will be updated if such undertakings are received.
• Foreign shareholders with non-Singapore addresses will not be eligible to participate unless they update their addresses to Singapore at least three Market Days before the Record Date.

Shareholders are also reminded that there is no assurance of the rights issue proceeding to completion, and they should exercise caution while trading shares.

Directors’ Statement

The Directors have confirmed that the Group’s current working capital is sufficient to meet its present requirements. However, they emphasized that the rights issue is necessary to support the Group’s strategic growth initiatives and strengthen its financial position.

Impact on Shareholders

The proposed rights issue, if fully subscribed, will significantly dilute existing shareholdings for those who choose not to participate. However, it provides an opportunity for shareholders to purchase additional shares at a discounted price, which could be an attractive proposition for those confident in the company’s future prospects.

Conclusion

TrickleStar’s rights issue is a pivotal move aimed at bolstering its financial strength and operational flexibility. Shareholders are encouraged to carefully evaluate their participation in this rights issue, given the significant discount and potential for future growth opportunities.