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Malaysia Airlines plans 1-for-3 rights issue, preference issue

16-Jan-2007

KUALA LUMPUR (XFN-ASIA) - Malaysian Airline System Bhd (MAS) said it is

proposing to issue a one-for-three rights issue involving up to 418 mln

new shares, and a separate redeemable convertible preference shares

issue of the same size.

MAS said in a statement the convertible shares will be priced at 1.0 rgt per share, while the price for the rights shares issue will be determined at a later date.

MAS, however, said the issue price for the rights shares will be subject to a maximum 45 pct discount to the theoretical ex-rights share price of MAS shares calculated based on a five-day weighted average market price.

It said he final discount will be determined by the board after considering the estimated cash requirements of the MAS Group of about 1.6 bln rgt.

The airline said the rights shares will raise funds for the group to finance its working capital and restructuring efforts.

It added that the rights shares issue complements the funding requirement identified in MAS's Business Turnaround Plan announced in February 2006.

It said the rights will also facilitate the recapitalization of MAS and assist the airline in achieving an effective capital structure and gearing level.


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