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The shipping firm said this would be done via the cancellation of the issued share capital which is lost or unrepresented by available assets.
The credit arising from the exercise would be used to set off the company’s accumulated losses while the balance, if any, would be credited to its retained earnings, it said in a filing with Bursa Malaysia today.
As of May 3, 2023, the company had an issued share capital of RM338.79 million comprising a billion ordinary shares.
MBC said that due to the accumulated losses, the share capital to be cancelled was substantially no longer represented by available assets.
“The proposed capital reduction will enable the company to eliminate its accumulated losses to reflect more accurately the value of its underlying assets and financial position; (and) enhance the company’s ability to declare and pay dividends out of its retained earnings in the future,” it said.
The exercise would also enhance the group’s credibility with its customers, financiers, suppliers, investors and other stakeholders following the reduction of the accumulated losses, it added.
MBC said the proposed capital reduction was expected to be completed by the third quarter of 2023.
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