Asian Micro Holdings Gains SGX Nod for Debt Capitalisation and Employee Bonus Share Issue: What Investors Need to Know

Key Developments: SGX Approves Major Corporate Actions

Asian Micro Holdings Limited (“AMHL”) has announced a critical milestone in its corporate restructuring efforts, receiving the Listing and Quotation Notice (LQN) from the Singapore Exchange Securities Trading Limited (SGX-ST) for two major initiatives:

• Proposed Debt Capitalisation – Conversion of debt into equity through the issuance of Conversion Shares.
• Proposed Issue and Allotment of Shares as Bonus to Employees – Granting Employee Bonus Shares to reward and incentivise staff.

These initiatives are subject to shareholder approval at an upcoming extraordinary general meeting (EGM), as well as full compliance with SGX-ST listing requirements.

What Shareholders Need to Know

• Shareholder Approval Required: Both the debt capitalisation and the employee bonus share issue must be approved at an EGM. Investors should monitor announcements regarding the meeting date and voting process.
• SGX-ST’s Conditional Approval: The LQN from SGX-ST is conditional. Notably, if AMHL acquires assets from related parties, such as Mr Lim Kee Liew (aka Victor Lim), Mdm Leong Lai Heng, Mr Ng Chee Wee, or their affiliates, SGX-ST reserves the right to aggregate these acquisitions with the debt capitalisation. This could result in these combined actions being classified as a “very substantial acquisition” or even a “reverse takeover” under Rule 1015 of the Catalist Rules.
• Potential Share Price Impact: The conversion of debt into equity and the issuance of bonus shares could significantly alter the company’s capital structure. This may lead to dilution effects for existing shareholders, but could also improve the balance sheet by reducing liabilities.
• Regulatory Caution: The LQN is not an endorsement of the merits of the proposals, the company, or its securities by SGX-ST. Shareholders are urged to exercise caution, monitor company disclosures, and seek independent professional advice as needed.

Why This Matters for Investors

These corporate actions could be game-changers for AMHL’s financial health and future strategy. By converting debt into equity, the company may strengthen its balance sheet, enhance creditworthiness, and position itself for new growth opportunities. The bonus share issue could boost employee morale and retention, supporting operational performance.

However, the potential for significant asset acquisitions from related parties introduces both opportunities and risks. Should the SGX-ST aggregate such deals with the current proposals, shareholders could be looking at a transaction that fundamentally transforms AMHL’s business and risk profile.

In summary, these developments are highly price-sensitive. Investors should watch for further announcements concerning the EGM, details of any related party transactions, and the specific terms of the debt conversion and bonus share issues.

Company Statement and Next Steps

AMHL’s Board, led by Independent Non-Executive Chairman Cheah Wee Teong, will provide further updates as the proposals move forward. The company’s sponsor, RHT Capital Pte. Ltd., has reviewed the announcement, but the SGX-ST assumes no responsibility for its contents.

Shareholders and potential investors are advised to remain vigilant and seek professional advice before making investment decisions.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or an offer to buy or sell any securities. Investors should conduct their own due diligence and consult with professional advisers before making investment decisions.

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