Proposed Renounceable rights issue of up to 233,249,942 New ordinary shares of RM0.50 each in salcon with Up To 116,624,971 Free Detachable Warrants, On The Basis of two (2) rights shares with One (1) Warrant For Every Two (2) Existing Ordinary Shares Of RM0.50 Each In Salcon ("Proposed Rights Issue With Warrants")

BackMar 09, 2007
General Announcement
Reference No MM-070309-62447

Submitting Merchant Bank
:
 MIMB INVESTMENT BANK BERHAD 
Company Name
:
 SALCON BERHAD 
Stock Name
:
 SALCON
Date Announced
:
 09/03/2007


Type : Announcement
Subject : PROPOSED RENOUNCEABLE RIGHTS ISSUE OF UP TO 233,249,942 NEW ORDINARY SHARES OF RM0.50 EACH IN SALCON WITH UP TO 116,624,971 FREE DETACHABLE WARRANTS, ON THE BASIS OF TWO (2) RIGHTS SHARES WITH ONE (1) WARRANT FOR EVERY TWO (2) EXISTING ORDINARY SHARES OF RM0.50 EACH IN SALCON ("PROPOSED RIGHTS ISSUE WITH WARRANTS")

Contents :

We refer to the announcement made on behalf of the Board of Directors of Salcon by MIMB Investment Bank Berhad ("MIMB") on 15 January 2007, 15 February 2007, 16 February 2007 and 5 March 2007 in relation to the abovementioned Proposed Rights Issue with Warrants.

On behalf of the Board of Directors of Salcon ("Board"), MIMB is pleased to announce that the Board had on 9 March 2007 resolved to fix the following prices for the securities to be issued pursuant to the Proposed Rights Issue with Warrants as follows:

(i) the issue price of new ordinary shares of RM0.50 each in Salcon ("Salcon Shares" or "Shares") to be issued pursuant to the Proposed Rights Issue with Warrants ("Rights Shares") shall be fixed at RM0.57 per Rights Share; and

(ii) the exercise price of detachable warrants in Salcon ("Warrants") to be issued pursuant to the Proposed Rights Issue with Warrants shall be fixed at RM0.75 per new ordinary share of RM0.50 each in Salcon.

The aforementioned issue price of RM0.57 per Rights Share was arrived at based on a discount of about RM0.25 (or 30.5%) from the theoretical ex-rights price of Salcon Shares of RM0.82 calculated based on the 5-day weighted average market price of Salcon Shares as traded on Bursa Malaysia Securities Berhad from 2 March 2007 to 8 March 2007 of RM1.079 per Share.

The aforementioned exercise price of RM0.75 per new Salcon Share to which a Warrant holder will be entitled to subscribe upon exercise of the Warrants was at a discount of RM0.07 (or 8.5%) from the theoretical ex-rights price of Salcon Shares of RM0.82.

The utilisation of proceeds from the Proposed Rights Issue with Warrants at the issue price of RM0.57 per Rights Share remains the same as per the announcement on 15 January 2007.

Based on the exercise price of the Warrants of RM0.75 per share and assuming up to 116,624,971 Warrants are issued and exercised, the total gross proceeds to be raised from the exercise of the Warrants would amount to RM87,468,728, which will be utilised as additional working capital of the Salcon group.

This announcement is dated 9 March 2007.