Alco Holdings Limited has announced a non-underwritten rights issue intended to strengthen its balance sheet and support business expansion.
Key terms • Basis: Four rights shares for every one existing share held on the 28 May 2026 record date. • Subscription price: HK$0.55 per rights share—20.3% below the last close of HK$0.69 and 24.2% under the preceding five-day average of HK$0.726. • Size: Up to 229.11 million new shares, expanding issued share capital from 57.28 million to a maximum 286.39 million—an increase of 400% and representing 80% of the enlarged total. • Gross proceeds: Up to HK$126.00 million; estimated net proceeds of about HK$121.80 million after expenses. • Listing: Applications will be made for trading of nil-paid and fully paid rights shares on the Stock Exchange. Nil-paid rights are expected to trade from 2 to 9 June 2026.
Use of proceeds (assuming full take-up) 1. HK$50.00 million (41%) – repay a HK$42 million unsecured loan from Proyan Consultancy Ltd. (20% p.a. interest) and related finance costs by September 2026. 2. HK$22.00 million (18%) – settle overdue payables to suppliers and other creditors by September 2026. 3. HK$31.50 million (26%) – expand sales channels and after-sales network in the Asia-Pacific region and upgrade product-design equipment by October 2026. 4. HK$18.30 million (15%) – general working-capital needs by December 2026.
Shareholder arrangements • No excess application facility; unsubscribed and non-qualifying shareholders’ entitlements will be placed to independent investors on a best-efforts basis. Any premium above the subscription price achieved from this placing will be distributed pro rata to the relevant shareholders. • To avoid triggering a mandatory general-offer obligation, applications will be scaled down where necessary. • Because the issue will enlarge share capital by more than 50% within 12 months, the plan requires approval from minority shareholders at a special general meeting scheduled for 15 May 2026.
Timetable highlights (2026) • Circular dispatch: 24 April • Last cum-rights trading day: 18 May • Register closure for rights entitlement: 21–28 May • Prospectus dispatch: 29 May • Payment/acceptance deadline: 12 June • Placing window for unsubscribed shares: 23 June–3 July • Expected listing of fully paid rights shares: 14 July
Capital-raising background Alco completed a HK$143.94 million rights issue in November 2025, using proceeds mainly to cut debt. The company continues to face net-liability and net-current-liability positions and cites heightened working-capital needs—particularly advance payments to OEM suppliers amid component-price volatility—as drivers for the latest fundraising.
Governance and approvals An Independent Board Committee comprising all independent non-executive directors will advise minority shareholders, and an independent financial adviser will opine on the proposal. No controlling shareholder exists; therefore, executive directors and their associates will abstain from voting at the SGM.
Risk reminder The rights issue and related placing are subject to multiple conditions, including shareholder approval and listing consent. If conditions are not met, the transaction will not proceed.
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