People’s Merchant Finance goes for revised Rights Issue to raise Rs. 811.8 m

People’s Merchant Finance PLC (PMF) has announced a revised Rights Issue to raise Rs. 811.8 million to enhance its core capital. 

The Rights Issue will be on the basis of 11 new shares for every 20 held at Rs. 7 per share. The move involves issuance of 115.98 million shares. 

In February last year the original move was to raise Rs. 809.76 million via a 12 for 25 Rights Issue (involving 101.22 million shares) at Rs. 8 per share. The current stated capital of the company is Rs. 2.44 billion.

PMF said with the outbreak of the COVID-19 pandemic and lockdowns in mid-March 2020 throughout the country and the world at large, the normal life and activities across all segments were impacted severely.

In light of this unforeseen event which resulted in unprecedented challenges in every aspect including economic and market downturns, it was not possible to pursue the announced Rights Issue in the last few months, resulting in a significant delay in launching the same.

It said the revised Rights Issue was after considering the current economic and market conditions due to the challenges posed by the COVID-19 pandemic and with the intention of making the Rights Issue attractive to the public investors.

The requisite approval of the CSE has been obtained for the aforesaid revision of the terms of the Rights Issue.

The purpose for which the proceeds are to be utilized: The Rights Issue is carried out in order to meet the minimum core capital requirements stipulated by the Monetary Board of the Central Bank of Sri Lanka (CBSL) in terms of Directions issued under the Finance Business Act No. 42 of 2011.

An Extraordinary General Meeting will be convened to obtain the shareholder approval for the

Rights Issue, upon the receipt of the in principle approval of the CSE. PMF has obtained approval from the CBSL for the Rights Issue.