Addvalue Technologies Issues 3.5 Million New Shares After Warrant Exercises: What It Means for Shareholders

Key Highlights

• 3,500,000 new ordinary shares issued following the exercise of detachable warrants by investors.
• Exercise price set at S\$0.013 per share, with total proceeds of S\$45,500 raised for working capital needs.
• Share capital increases to 3,286,532,092 ordinary shares.
• Proceeds to be used for payroll and general administrative expenses.
• Warrant pool reduced: 9,000,000 outstanding under Non-Restricted Persons Issue, 37,500,000 under Restricted Persons Issue.
• New shares to be listed and quoted on SGX Mainboard on 4 September 2025.
• New shares represent 0.11% of both pre- and post-issue share capital.

In-Depth Analysis for Retail Investors

Addvalue Technologies Ltd has announced the successful exercise of 3.5 million detachable warrants, resulting in the issuance and allotment of a corresponding number of new ordinary shares. This move follows a series of earlier announcements about the company’s capital-raising efforts via convertible loan notes and warrants initiated in late 2023 and early 2024.

The new shares were priced at S\$0.013 per unit, raising a total of S\$45,500. These funds will be directed toward the company’s working capital requirements, particularly payroll and general administrative expenses. The application of proceeds aligns with previous disclosures and does not represent a deviation from the intended use of funds.

Of the 3.5 million new shares:

• 2,000,000 shares were issued to Restricted Persons, as approved by shareholders at an Extraordinary General Meeting (EGM) on 6 March 2024.
• 1,500,000 shares were issued to Non-Restricted Persons under the general share issuance mandate granted on 28 January 2024.

The differentiation between Restricted and Non-Restricted Persons is based on definitions provided in previous company announcements, ensuring compliance with regulatory and shareholder approvals.

The result of this warrant exercise is an increase in the company’s issued share capital from 3,283,032,092 to 3,286,532,092 ordinary shares. The enlarged paid-up share capital now stands at S\$119,132,663.00.

The outstanding warrants have now decreased to 9 million (Non-Restricted) and 37.5 million (Restricted), reflecting continued investor interest and the potential for further dilution should more warrants be exercised.

The freshly issued shares represent a modest 0.11% increase in the company’s total share capital, both before and after the transaction. While this is a relatively small dilution, it is important for existing shareholders to monitor such changes, as cumulative exercises could eventually have a more pronounced impact on shareholding percentages and potential earnings per share.

Potential Share Price Impact and Shareholder Considerations

Why is this news potentially price-sensitive?

• The warrant exercise and new share issuance result in direct dilution to existing shareholders, albeit marginal at this stage (0.11%). If significant numbers of warrants are exercised in the future, further dilution could occur.
• The raised funds are earmarked for working capital, indicating the company’s ongoing need for operational cash flow support rather than growth initiatives. Investors may interpret this as a signal of the company’s financial standing and its reliance on equity-linked funding.
• The ongoing reduction in the pool of outstanding warrants reduces the potential future overhang but also signals that current investors are converting their warrants, possibly anticipating improved share performance or seeking to crystallize value.
• The listing and quotation of these new shares on the SGX Mainboard from 4 September 2025 could affect trading liquidity and price dynamics in the short term as new shares enter the market.

What Should Shareholders Do?

Shareholders are encouraged to monitor future warrant exercises closely, as repeated dilution could impact long-term value. It is also prudent to assess the company’s ability to transition from reliance on warrant exercises for working capital to more sustainable growth financing.

Conclusion

The exercise of warrants and the issuance of new shares by Addvalue Technologies is a routine but important development in the company’s capital management. While the immediate dilution is small, the trend of relying on such instruments for funding could influence investor sentiment and share price trajectory. Retail investors should keep a close eye on subsequent warrant exercises and the company’s overall financial health.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any securities. Investors should conduct their own research and consult with a professional advisor before making investment decisions.

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