(I) PROPOSED BONUS ISSUE OF UP TO 2,804,471,128 · PDF filewith regards to the Proposed Bonus...

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SUNWAY BERHAD (“SUNWAY” OR THE “COMPANY”) (I) PROPOSED BONUS ISSUE OF UP TO 2,804,471,128 NEW ORDINARY SHARES IN

SUNWAY (“SUNWAY SHARES” OR “SHARES”) (“BONUS SHARES”) ON THE BASIS OF FOUR (4) BONUS SHARES FOR EVERY THREE (3) EXISTING SUNWAY SHARES HELD ON AN ENTITLEMENT DATE TO BE DETERMINED LATER (“PROPOSED BONUS ISSUE OF SHARES”); AND

(II) PROPOSED BONUS ISSUE OF UP TO 631,006,003 FREE WARRANTS IN SUNWAY

(“WARRANTS”) ON THE BASIS OF THREE (3) WARRANTS FOR EVERY TEN (10) EXISTING SUNWAY SHARES HELD ON THE SAME ENTITLEMENT DATE AS THE PROPOSED BONUS ISSUE OF SHARES (“PROPOSED BONUS ISSUE OF WARRANTS”).

(COLLECTIVELY REFERRED TO AS THE “PROPOSALS”)

1. INTRODUCTION

On behalf of the Board of Directors of Sunway (“Board”), Kenanga Investment Bank Berhad (“Kenanga IB”) is pleased to announce that the Company is proposing to undertake the Proposed Bonus Issue of Shares and Proposed Bonus Issue of Warrants.

2. DETAILS OF THE PROPOSALS 2.1 Details of the Proposed Bonus Issue of Shares

The Proposed Bonus Issue of Shares will entail the issuance of up to 2,804,471,128 Bonus Shares to be credited as fully paid-up on the basis of four (4) Bonus Shares for every three (3) existing Sunway Shares held by the shareholders of Sunway whose names appears on the Record of Depositors of the Company at the close of business on a date to be determined and announced later by the Board (“Entitlement Date”). As at 31 May 2017, being the latest practicable date prior to the date of this announcement (“LPD”), the issued share capital of Sunway is RM2,101,340,559 comprising 2,074,405,769 Sunway Shares (including 18,306,362 treasury shares). In line with the Proposals, the Company undertakes that Sunway will not purchase any additional Shares pursuant to its share buy-back exercise until the completion of the Proposals. The Company has no intention to deal with the treasury shares which the Company currently holds, whether to resell and/or distribute, prior to the completion of the Proposals. Notwithstanding that, the Company reserves the rights to transfer its treasury shares for the purposes of or under its Employees Share Option Scheme (“ESOS”) (“ESOS Option(s)”) pursuant to the exercise of any vested ESOS Options. As at the LPD, all the ESOS Options granted have been fully vested.

The bases of computing the minimum and maximum number of Bonus Shares in respect of the Proposed Bonus Issue of Shares are set out below: Minimum Scenario - minimum number of up to 2,741,465,876 Bonus Shares taking

into account the following:

(i) the issued share capital of the Company of RM2,063,066,819 comprising 2,063,066,819 Sunway Shares based on the audited financial statements of the Company for the financial year ended (“FYE”) 31 December 2016; and

(ii) 18,306,362 treasury shares as at the LPD; and

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(iii) 11,338,950 new Sunway Shares issued pursuant to the exercise of 11,338,950 ESOS Options granted for the period from 1 January 2017 up to LPD.

Maximum Scenario - maximum number of up to 2,804,471,128 Bonus Shares taking

into account item (i), (ii) and (iii) as set out above and 47,253,939 new Sunway Shares which may be issued on or prior to the Entitlement Date pursuant to the full exercise of outstanding exercisable ESOS Options. As at the LPD, the number of outstanding exercisable ESOS Options is 47,253,939.

Fractional entitlements arising from the Proposed Bonus Issue of Shares, if any, shall be dealt with in such a manner as the Board shall in its absolute discretion deem fit and expedient, and in the best interest of the Company. In any event, the actual number of Bonus Shares to be issued will be determined based on the number of Sunway Shares in issue as at the Entitlement Date. The Entitlement Date will be determined and announced at a later date upon receipt of all relevant approvals for the Proposed Bonus Issue of Shares. The Proposed Bonus Issue of Shares is not intended to be implemented in stages over a period of time. Subsequent to the Entitlement Date of the Proposed Bonus Issue of Shares, the Company‟s share price will be adjusted. For illustrative purposes, based on the closing price of Sunway Shares of RM3.55 as at the LPD, the theoretical ex-bonus price (“TEBP”) of Sunway Shares is RM1.52.

2.1.1 Capitalisation of share premium

The Proposed Bonus Issue of Shares is to be effected by way of capitalising the share premium of the Company.

For illustrative purposes, the pro forma effects of the Proposed Bonus Issue of Shares on the share premium based on the Company‟s; (a) audited financial statements for the FYE 31 December 2016; and (b) unaudited financial statements for the period ended 31 March 2017, are as follows: (a) audited financial statements for the FYE 31 December 2016

Share premium at Company level

Minimum Scenario (RM‟ 000)

Maximum Scenario (RM‟ 000)

Audited as at 31 December 2016 3,118,802 3,118,802

Adjustments (1)

383 383

3,119,185 3,119,185

Amount to be capitalised for the Proposed Bonus Issue of Shares (2,741,466) (2,804,471)

Estimated expenses for the Proposals (530) (530)

After the Proposed Bonus Issue of Shares 377,189 314,184

Note:

(1) Being adjustments relating to ESOS Options prior to the effective date (31 January 2017)

of the no par value regime under the Companies Act, 2016 (“Act”).

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(b) unaudited financial statements for the period ended 31 March 2017

Share premium at Company level

Minimum Scenario (RM‟ 000)

Maximum Scenario (RM‟ 000)

Unaudited as at 31 March 2017 3,119,185 3,119,185

Amount to be capitalised for the Proposed Bonus Issue of Shares (2,741,466) (2,804,471)

Estimated expenses for the Proposals (530) (530)

After the Proposed Bonus Issue of Shares 377,189 314,184

The Board confirms that the Company has adequate share premium available for the issuance of the Bonus Shares and such share premium which is required for the issuance of the Bonus Shares is unimpaired by losses at the Company level and also on a consolidated basis based on the latest audited consolidated financial statements of Sunway for the FYE 31 December 2016 as well as the latest unaudited financial statement for the period ended 31 March 2017 which in accordance with paragraph 6.30(1) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) (“Listing Requirements”).

2.1.2 Ranking of the Bonus Shares

The Bonus Shares shall, upon allotment and issuance, rank pari passu in all respects with the then existing Sunway Shares, except that the Bonus Shares will not be entitled to any dividends, rights, allotments and/or other distributions, in respect of which the entitlement date is prior to the date of allotment of the Bonus Shares.

2.1.3 Listing of and quotation for the Bonus Shares

An application will be made to Bursa Securities for the listing of and quotation for the Bonus Shares on the Main Market of Bursa Securities.

2.2 Proposed Bonus Issue of Warrants

The Proposed Bonus Issue of Warrants involves the issuance of up to 631,006,003 Warrants on the basis of three (3) Warrants for every ten (10) existing Sunway Shares held by the shareholders of Sunway on the same Entitlement Date as the Proposed Bonus Issue of Shares. For the avoidance of doubt, the Bonus Shares are not entitled to the Warrants. The minimum and maximum number of Warrants in respect of the Proposed Bonus Issue of Warrants will be computed on the same basis as that of the Proposed Bonus Issue of Shares set out in Section 2.1 of this announcement. Any fractional entitlements of the Warrants, if any, shall be dealt with in such manner as the Board shall in its absolute discretion think fit and expedient, and in the best interests of the Company. The Proposed Bonus Issue of Warrants will not be implemented in stages over a period of time. The Warrants will be issued in registered form and constituted by a deed poll to be executed by the Company (“Deed Poll”). The indicative salient terms of the Warrants are set out in Section 2.2.5 of this announcement.

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2.2.1 Ranking of Warrants and new Sunway Shares to be issued arising from the exercise of the Warrants

The holders of the Warrants will not be entitled to any voting rights or participation in any form of distribution other than on winding-up, compromise or arrangement of Sunway to be set out in the Deed Poll and/or any offer of further securities in Sunway until and unless such holders of the Warrants exercise their Warrants into new Sunway Shares. The new Sunway Shares to be issued pursuant to the exercise of the Warrants shall upon allotment and issuance, rank pari passu in all respects with the existing Sunway Shares, save and except that the new Sunway Shares will not be entitled to any dividends, rights, allotments and/or other distributions that may be declared, made or paid for which the entitlement date precedes the date of allotment and issuance of the new Sunway Shares arising from the exercise of the Warrants.

2.2.2 Capitalisation of reserves

There will not be any capitalisation of reserves arising from the issuance of the Warrants pursuant to the Proposed Bonus Issue of Warrants. Therefore, the requirement to ensure that the necessary reserves required for capitalisation is unimpaired by losses of the Company on a consolidated basis pursuant to Paragraph 6.30 of the Listing Requirements is not applicable with regards to the Proposed Bonus Issue of Warrants.

2.2.3 Listing of and quotation for the Warrants and new Sunway Shares to be issued arising

from the exercise of the Warrants

An application will be made to Bursa Securities for the admission of the Warrants to the Official List of the Main Market of Bursa Securities as well as for the listing of and quotation for the Warrants and the new Sunway Shares to be issued arising from the exercise of the Warrants on the Main Market of Bursa Securities.

2.2.4 Basis of determining the issue price and exercise price of the Warrants

The Warrants will be issued at no cost to the shareholders on a pro rata basis. The exercise price of the Warrants will be determined and announced at a later date by the Board after obtaining the relevant approvals but before the Entitlement Date. The exercise price of the Warrants will be determined and fixed by the Board after taking into consideration, amongst others, the following: (i) The historical price movement of Sunway Shares; (ii) The five (5)-day volume weighted average market price (“VWAMP”) of Sunway

Shares prior to price-fixing date, adjusted for the Proposed Bonus Issue of Shares, with a discount or premium to be determined later based on market-based principles;

(iii) The prevailing market conditions; and (iv) The future working capital requirements of Sunway and its subsidiaries (“Sunway

Group”).

For illustrative purposes, the exercise price of the Warrants is assumed at RM1.53 computed based on five (5)-day VWAMP of Sunway Shares of RM3.5702 up to and including the LPD and adjusted for the Proposed Bonus Issue of Shares.

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2.2.5 Indicative principal terms of the Warrants

Issue size : Up to 631,006,003 Warrants Form : The Warrants will be issued in registered form and constituted

by a Deed Poll Exercise price : The amount payable in respect of each new Share calculated on

an annual step-down basis, details of which are to be set out in the Deed Poll.

Exercise period : The period commencing on and including the date of issuance of

the Warrants and ending on the Expiry Date. Warrants not exercised during the exercise period will thereafter lapse and cease to be valid

Mode of exercise : The registered holder of the Warrant is required to lodge an

exercise form, to be set out in the Deed Poll, with the Company‟s registrar, duly completed and signed together with payment of the exercise price via banker‟s draft or cashier‟s order or money order or postal order drawn on a bank or post office in Malaysia

Exercise rights : The rights conferred on a Warrant holder to subscribe for one (1)

new Sunway Share for one (1) Warrant at the Exercise Price at any time during the Exercise Period subject to adjustments in accordance with the provisions of the Deed Poll

Expiry date : The close of business at 5.00 p.m. in Malaysia on the date

immediately preceding the seventh (7th) anniversary of the date

of issuance of the Warrants, and if such date is not a Market Day, then on the preceding Market Day

Board lot : For the purpose of trading on Bursa Securities, one (1) board lot

of Warrants shall comprise 100 Warrants carrying the rights to subscribe for 100 new Sunway Shares at any time during the exercise period, or such other denomination as determined by Bursa Securities

Ranking of new Sunway Shares

: The new Sunway Shares to be issued arising from the exercise of the Warrants, shall upon allotment and issuance, rank pari passu in all respects with the existing Sunway Shares, save and except that the new Sunway Shares will not be entitled to any dividends, rights, allotments and/or other forms of distribution that may be declared, made or paid for which the entitlement date precedes the date of allotment and issuance of such new Sunway Shares

Participating rights of the Warrant holders in any distribution and/or offer of further securities

: The Warrants do not entitle the Warrant holders to any dividends, rights, allotments and/or any form of distributions that may be declared, made or paid, the entitlement date of which is prior to the date of allotment and issuance of the new Sunway Shares to be issued arising from the exercise of the Warrants. The Warrants do not entitle the Warrant holders to any voting rights in any general meeting of the Company until and unless such Warrant holders exercise their Warrants for new Sunway Shares

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Adjustment in the exercise price and/or number of Warrants

: The exercise price and/or the number of unexercised Warrants may be subject to such adjustments in the event of any alteration to the share capital of the Company at any time during the tenure of the Warrants, whether by way of, amongst others, rights issue, bonus issue, consolidation of shares, subdivision of shares or reduction of capital in accordance with the provisions of the Deed Poll

Modifications : Subject to the approval of any relevant authority as required

under the law, any modification, amendment or addition to the Deed Poll must be approved by the Warrant holders sanctioned by ordinary resolution, effected by a supplemental deed poll, executed by the Company and expressed to be supplemental and comply with the requirements of the Deed Poll. The Company must notify the Warrant holders of every modification within thirty (30) days after such modification is effected in accordance with the provisions of the Deed Poll

Rights of the Warrant holders in the event of winding-up, liquidation, compromise or arrangement

: Where a resolution has been passed for a members‟ voluntary winding-up of the Company, or where there is a compromise or arrangement, whether or not for the purpose of or in connection with a scheme for the reconstruction of the Company or the amalgamation of the Company with one (1) or more companies, (i) if such winding up, compromise or scheme of

arrangement is one in which the Warrant holders, or some person designated by them for such purpose by Special Resolution, are to be a party, the terms of such winding up, compromise or scheme of arrangement shall be binding on all the Warrant holders;

(ii) in any other case, every Warrant holder is entitled, upon

and subject to the Conditions at any time, within six (6) weeks after the passing of such resolution for a members‟ voluntary winding up of the Company or within six (6) weeks from the granting of the court order approving the compromise or arrangement, as the case may be, by the irrevocable surrender of his Warrants to the Company by submitting the Exercise Form(s) duly completed, authorising the debiting of his Warrants, together with payment of the relevant Exercise Price, to elect to be treated as if he had immediately prior to the commencement of such winding up, compromise or arrangement, exercised the Exercise Rights represented by such Warrants to the extent specified in the Exercise Form(s) and be entitled to receive out of the assets of the Company which would be available in liquidation if he had on such date been the holder of the new Shares to which he would have become entitled pursuant to such exercise and the liquidator of the Company, must give effect to such election accordingly. All Exercise Rights, which have not been exercised within the above six (6) weeks of either the passing of such resolution for the winding up or the granting of the court order for the approval of such compromise or arrangement, as the case may be, will lapse and the Warrants will cease to be valid for any purpose.

Governing law : Laws and regulations of Malaysia

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2.3 Adjustments to the ESOS Options

The ESOS By-laws constituting the Company‟s ESOS provides for, amongst others, adjustment to be made to the option price of the unexercised ESOS Options and the number of ESOS Options in the event of bonus issue.

3. UTILISATION OF PROCEEDS

The Proposed Bonus Issue of Shares will not raise any funds. The Proposed Bonus Issue of Warrants will not raise any immediate funds upon its issuance as the Warrants will be issued at no cost to the entitled shareholders of Sunway. The exact quantum of the future proceeds that may be raised by Sunway would depend upon the exercise price of the Warrants and the actual number of Warrants exercised during the tenure of the Warrants. As such, the exact timeframe for utilisation of the proceeds is not determinable at this juncture. Assuming full exercise of the Warrants at the indicative exercise price of RM1.53 per Warrant, a total of up to 631,006,003 new Sunway Shares would be issued and the Company could potentially raise the maximum gross proceeds of RM965,439,185. Such proceeds to be raised, as and when the Warrants are exercised, shall be utilised for the future working capital requirements of Sunway Group, which include, amongst others, payment to trade and other payables, staff costs and other operating expenses such as rental and utilities. The proceeds to be utilised for each component of working capital are subject to the Sunway Group‟s operating requirements at the time of utilisation and therefore cannot be determined at this juncture.

4. RATIONALE FOR THE PROPOSALS

The Proposals are aimed at rewarding shareholders of the Company for their confidence in the Sunway Group and continuing support by giving them additional participation in the equity of the Company in terms of number of Shares held, whilst maintaining their equity interest. In addition, the Proposed Bonus Issue of Shares is expected to enhance the marketability and trading liquidity of Sunway Shares on Bursa Securities by way of a larger capital base.

Further, the Board is of the view that the Proposed Bonus Issue of Warrants is an appropriate avenue for rewarding the existing shareholders of Sunway after taking into consideration, amongst others, the following factors: (a) the Proposed Bonus Issue of Warrants will reward the shareholders for their

continuous support by enabling them to participate in a derivative of Sunway without incurring any costs;

(b) the issuance of Warrants will provide the shareholders with an opportunity to further increase their equity participation in the Company by exercising the Warrants at a pre-determined price over the tenure of the Warrants. The shareholders who are entitled to the Warrants may also benefit from any potential capital appreciation arising from the exercise of the Warrants;

(c) to strengthen its financial position with enhanced shareholders‟ funds and enlarged

capital base pursuant to the exercise of Warrants into new Sunway Shares which is expected to enhance the liquidity of Sunway Shares on the Main Market of Bursa Securities;

(d) the Warrants will enable the Company to raise further proceeds as and when the

Warrants are exercised, for working capital requirements of the Sunway Group;

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The incorporation of a step-down pricing mechanism encourages long-term holding and promotes confidence and continuous support as it is more attractive to exercise the Warrants in the later part of the tenure of the Warrants. Accordingly, the step-down pricing mechanism deters immediate dilution to the equity shareholdings arising from the exercise of Warrants.

5. EFFECTS OF THE PROPOSALS

For illustrative purposes, the pro forma effects of the Proposals based on the Minimum and Maximum Scenarios are as follows:

5.1 Share capital

The pro forma effects of the Proposals on the share capital of the Company are as follows:

Minimum Scenario Maximum Scenario

No. of Sunway Shares

Amount


Amount

(„000) (RM „000) („000) (RM „000)

Share capital as at the LPD 2,074,405 2,101,341(1)

2,074,405 2,101,341(1)

Less: Treasury shares (18,306) (57,437) (18,306) (57,437)

2,056,099 2,043,904 2,056,099 2,043,904 Upon full exercise of outstanding exercisable ESOS Options

(2) - - 47,254 181,853

2,056,099 2,043,904 2,103,353 2,225,757 To be issued pursuant to the Proposed Bonus Issue of Shares 2,741,466 2,741,466 2,804,471 2,804,471 To be issued pursuant to the Proposed Bonus Issue of Warrants

(3) 616,830 943,750 631,006 965,439

Enlarged issued share capital (excluding treasury shares) 5,414,395 5,729,120 5,538,830 5,995,667

Notes:

(1) Pursuant to Section 74 of the Act, as at the LPD, the share capital of RM2,101,340,559 includes the reversal of share option reserve from the exercise of ESOS Options of RM9,441,228.

(2) Assuming all 47,253,939 ESOS Options outstanding and exercisable as at the LPD are exercised by the ESOS Option holders on or prior to the Entitlement Date.

(3) Assuming all entitled shareholders of the Company exercise their Warrants.

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5.2 Net assets and gearing

The pro forma effects of the Proposals on the net assets (“NA”) per Sunway Share and gearing of the Sunway Group are as follows:

(a) Minimum Scenario

Pro forma (I)

Pro forma (II)

Pro forma (III)

Audited as at 31 December 2016

After Adjustments^

After Pro forma (I)

and the Proposals

After Pro forma (II) and

Assuming Full Exercise of Warrants

(3)

(RM „000) (RM „000) (RM „000) (RM „000)

Share capital 2,063,067 2,101,341 4,842,807 5,786,557

Treasury Shares (120,532) (57,437) (57,437) (57,437) Share premium

(1) 3,118,802 3,119,185 377,189

(2) 377,189

Equity contribution from non- controlling interests 51,654 51,654 51,654 51,654 Merger reserve (1,192,040) (1,192,040) (1,192,040) (1,192,040) Share option reserve 63,987 54,404 54,404 54,404 Other reserve 323,870 323,870 323,870 323,870 Retained earnings 3,160,914 3,016,087 3,016,087 3,016,087

NA attributable to shareholders of the Company 7,469,722 7,417,064 7,416,534 8,360,284

Number of Sunway Shares in issue („000) (excluding treasury shares) 2,024,657 2,056,099 4,797,565 5,414,395

NA per Sunway Share (RM)(4)

3.69 3.61 1.55 1.54

Total borrowings 7,413,167 7,413,167 7,413,167 7,413,167

Cash and bank balances and placement in funds 4,080,055 4,027,396 4,026,866 4,970,615 Gearing (times)

(5) 0.99 1.00 1.00 0.89

Net gearing (times)(6)

0.45 0.46 0.46 0.29

Notes:

^ Being adjustments which comprise the following: (i) Exercise of 11,338,950 ESOS Options by ESOS Option holders for the period from 1 January 2017 up to and including the LPD; (ii) Reversal of share option reserve pursuant to the exercise of ESOS Options for the period from 1 January 2017 up to and including the LPD;

(iii) Share buy-back of 191,900 Sunway Shares by the Company for the period from 1 January 2017 up to and including the LPD; and

(iv) A second interim single tier dividend comprising a cash dividend of 4 sen per Sunway Share and a share dividend distribution of approximately 20.3 million treasury shares in

respect of the FYE 31 December 2016 paid on 28 April 2017.

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(1) With the introduction of the Act, the Company has elected to utilise its share premium for purposes stipulated in Section 618(3) of the Act. (2) After capitalising approximately RM2,741.5 million for the Proposed Bonus Issue of Shares and deducting the estimated expenses of approximately RM0.53 million. (3) Based on the illustrative exercise price of RM1.53 per Warrant.

(4) Calculated as NA attributable to shareholders of the Company divided by the number of Sunway Shares in issue (excluding treasury shares).

(5) Calculated as total borrowings (all interest bearing debts) divided by NA attributable to shareholders of the Company.

(6) Calculated as total borrowings (all interest bearing debts) less cash and bank balances and placement in funds divided by NA attributable to shareholders of the Company.

(b) Maximum Scenario

Pro forma (I) Pro forma (II) Pro forma (III) Pro forma (IV)

Audited as at 31 December

2016

After Adjustments^

After Pro forma (I) and full exercise

of outstanding exercisable

ESOS Options

(1)

After Pro forma (II) and the Proposals

After Pro forma (III) and

Assuming Full Exercise of Warrants

(4)

(RM „000) (RM „000) (RM „000) (RM „000) (RM „000)

Share capital 2,063,067 2,101,341 2,283,194 5,087,665 6,053,104

Treasury shares (120,532) (57,437) (57,437) (57,437) (57,437) Share premium

(2) 3,118,802 3,119,185 3,119,185 314,184

(3) 314,184

Equity contribution from non-controlling interests 51,654 51,654 51,654 51,654 51,654 Merger reserve (1,192,040) (1,192,040) (1,192,040) (1,192,040) (1,192,040) Share option reserve 63,987 54,404 - - - Other reserve 323,870 323,870 323,870 323,870 323,870 Retained earnings 3,160,914 3,016,087 3,016,087 3,016,087 3,016,087

NA attributable to shareholders of the Company 7,469,722 7,417,064 7,544,513 7,543,983 8,509,422

Number of Sunway Shares in issue („000) (excluding treasury shares)

2,024,657 2,056,099 2,103,353 4,907,824 5,538,830

NA per Sunway Share (RM)(5)

3.69 3.61 3.59 1.54 1.54

Total borrowings 7,413,167 7,413,167 7,413,167 7,413,167 7,413,167

Cash and bank balances and placement in funds 4,080,055 4,027,396 4,154,845 4,154,315 5,119,754

Gearing (times)(6)

0.99 1.00 0.98 0.98 0.87

Net gearing (times)(7)

0.45 0.46 0.43 0.43 0.27

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Notes:

^ Being adjustments which comprise the following:

(i) Exercise of 11,338,950 ESOS Options by ESOS Option holders for the period from 1 January 2017 up to and including the LPD;

(ii) Reversal of share option reserve pursuant to the exercise of ESOS Options for the period from 1 January 2017 up to and including the LPD;

(iii) Share buy-back of 191,900 Sunway Shares by the Company for the period from 1 January 2017 up to and including the LPD; and (iv) A second interim single tier dividend comprising a cash dividend of 4 sen per Sunway Share and a share dividend distribution of approximately 20.3 million treasury shares in

respect of the FYE 31 December 2016 paid on 28 April 2017.

(1) Assuming 47,253,939 outstanding exercisable ESOS Option as at LPD are fully exercised.

(2) With the introduction of the Act, the Company has elected to utilise its share premium for purposes stipulated in Section 618(3) of the Act.

(3) After capitalising approximately RM2,804.5 million for the Proposed Bonus Issue of Shares and deducting the estimated expenses of approximately RM0.53 million. (4) Based on the illustrative exercise price of RM1.53 per Warrant.

(5) Calculated as NA attributable to shareholders of the Company divided by the number of Sunway Shares in issue (excluding treasury shares). (6) Calculated as total borrowings (all interest bearing debts) divided by NA attributable to shareholders of the Company.

(7) Calculated as total borrowings (all interest bearing debts) less cash and bank balances and placement in funds divided by NA attributable to shareholders of the Company.

THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK

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5.3 Substantial shareholders‟ shareholdings

The pro forma effects of the Proposals on the shareholdings of the substantial shareholders of Sunway Group are as follows:

(a) Minimum Scenario

Pro forma (I)

As at the LPD After the Proposals

After the Pro forma (I) and Assuming Full Exercise of Warrants

Direct Indirect Direct Indirect Direct Indirect

Substantial shareholders


(„000)

%


(„000)

%


(„000)

%


(„000)

%


(„000) %


(„000)

%

Tan Sri Dato‟ Seri Dr Jeffrey Cheah Fook Ling, AO

93,861 4.56 1,156,730(1)

56.26 219,008 4.56 2,699,037(1)

56.26 247,166 4.56 3,046,056(1)

56.26

Puan Sri Datin Seri (Dr) Susan Cheah Seok Cheng

- - 1,250,591(2)

60.82 - - 2,918,045(2)

60.82 - - 3,293,222(2)

60.82

Sarena Cheah Yean Tih 1,085 0.05 1,248,944 (3)

60.74 2,532 0.05 2,914,203(3)

60.74 2,857 0.05 3,288,887(3)

60.74

Evan Cheah Yean Shin 563 0.03 1,248,943(4)

60.74 1,313 0.03 2,914,201(4)

60.74 1,481 0.03 3,288,884(4)

60.74

Sungei Way Corporation Sdn Bhd

1,155,083 56.18 - - 2,695,193 56.18 - - 3,041,717 56.18 - -

Active Equity Sdn Bhd - - 1,155,083(5)

56.18 - - 2,695,193(5)

56.18 - - 3,041,717(5)

56.18

Employees Provident Fund Board

112,737 5.48 - - 263,054 5.48 - - 296,875 5.48 - -

Notes: (1) Deemed interest by virtue of Section 8 of the Act held through Active Equity Sdn Bhd, Sungei Way Corporation Sdn Bhd and children.

(2) Deemed interest by virtue of Section 8 of the Act held through spouse and children.

(3) Deemed interest by virtue of Section 8 of the Act held through Active Equity Sdn Bhd, Sungei Way Corporation Sdn Bhd, spouse and parent.

(4) Deemed interest by virtue of Section 8 of the Act held through Active Equity Sdn Bhd, Sungei Way Corporation Sdn Bhd and parent.

(5) Deemed interest by virtue of Section 8 of the Act held through Sungei Way Corporation Sdn Bhd.

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(b) Maximum Scenario

As at the LPD

Assuming the ESOS Options being fully exercised

Direct Indirect Direct Indirect



(„000)

%


(„000)

%


(„000)

%


(„000)

%


93,861 4.56 1,156,730(1)

56.26 106,761 5.08 1,159,050(1)

55.10


- - 1,250,591(2)

60.82 - - 1,265,811(2)

60.18

Sarena Cheah Yean Tih 1,085 0.05 1,248,944 (3)

60.74 2,205 0.10 1,261,844(3)

59.99

Evan Cheah Yean Shin 563 0.03 1,248,943(4)

60.74 1,763 0.08 1,261,843(4)

59.99


1,155,083 56.18 - - 1,155,083 54.92 - -


56.18 - - 1,155,083(5)

54.92


112,737 5.48 - - 112,737 5.36 - -

THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK

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(b) Maximum Scenario (Cont’d)

Pro forma (I)

After the Proposals After the Pro forma (I) and assuming full exercise of Warrants

Direct Indirect Direct Indirect



(„000)

%


(„000)

%


(„000)

%


(„000)

%


249,108 5.08 2,704,450(1)

55.10 281,136 5.08 3,052,165(1)

55.10


- - 2,953,558(2)

60.18 - - 3,333,302(2)

60.18

Sarena Cheah Yean Tih 5,146 0.10 2,944,303(3)

59.99 5,807 0.10 3,322,857(3)

59.99

Evan Cheah Yean Shin 4,113 0.08 2,944,301(4)

59.99 4,641 0.08 3,322,854(4)

59.99


2,695,193 54.92 - - 3,041,717 54.92 - -


54.92 - - 3,041,717(5)

54.92


263,054 5.36 - - 296,875 5.36 - -

Notes: (1) Deemed interest by virtue of Section 8 of the Act held through Active Equity Sdn Bhd, Sungei Way Corporation Sdn Bhd and children.

(2) Deemed interest by virtue of Section 8 of the Act held through spouse and children.

(3) Deemed interest by virtue of Section 8 of the Act held through Active Equity Sdn Bhd, Sungei Way Corporation Sdn Bhd, spouse and parent.

(4) Deemed interest by virtue of Section 8 of the Act held through Active Equity Sdn Bhd, Sungei Way Corporation Sdn Bhd and parent.

(5) Deemed interest by virtue of Section 8 of the Act held through Sungei Way Corporation Sdn Bhd.

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5.4 Earnings and earnings per share (“EPS”)

The Proposals are not expected to have any material effect on the earnings of the Sunway Group for the financial year ending 31 December 2017. However, assuming that the earnings of the Group remain unchanged, the EPS of the Sunway Group will be proportionately diluted as a result of the increase in the number of Sunway Shares arising from the Proposed Bonus Issue of Shares and potential exercise of Warrants.

5.5 Convertible securities

As at the LPD, save for the outstanding ESOS Options, the Company does not have any other convertible securities.

6. APPROVALS REQUIRED

The Proposals are subject to the following approvals being obtained:-

(a) Bursa Securities for the following:

(i) Listing of and quotation for up to 2,804,471,128 Bonus Shares on the Main Market of Bursa Securities;

(ii) Admission to the Official List and the listing of and quotation for up to 631,006,003 Warrants on the Main Market of Bursa Securities;

(iii) Listing of and quotation for up to 631,006,003 new Sunway Shares to be issued pursuant to the exercise of Warrants on the Main Market of Bursa Securities;

(b) The shareholders of the Company at an Extraordinary General Meeting to be convened for the Proposals; and

(c) Any other relevant authorities and/or parties (where required). The Proposals are not inter-conditional and are not conditional upon any other corporate exercise undertaken or to be undertaken by the Company.

7. ESTIMATED TIMEFRAME FOR COMPLETION

Barring any unforeseen circumstances and subject to all required approvals being obtained, the Proposals are expected to be completed by the 2

nd half of 2017.

8. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSONS CONNECTED TO THEM None of the Directors and major shareholders of the Company and/or persons connected to them has any interest, direct or indirect, in the Proposals beyond their respective entitlements to the Bonus Shares and Warrants as shareholders of Sunway, to which all other shareholders of Sunway are similarly entitled to on a pro rata basis.

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9. IMPLICATION OF THE MALAYSIAN CODE ON TAKE-OVERS AND MERGERS, 2016

The Company confirms that upon full exercise of Warrants by Tan Sri Dato‟ Seri Dr Jeffrey Cheah Fook Ling, AO, Puan Sri Datin Seri (Dr) Susan Cheah Seok Cheng, Sarena Cheah Yean Tih, Evan Cheah Yean Shin, Sungei Way Corporation Sdn Bhd, Active Equity Sdn Bhd and/or persons acting in concert with them, (assuming none of the other shareholders of Sunway exercises their Warrants) they will not trigger any mandatory general offer obligation pursuant to the current rules in the Malaysian Code on Take-Overs and Mergers, 2016 and Rules on Take-Overs, Mergers and Compulsory Acquisitions issued on 15 August 2016.

10. DIRECTORS‟ STATEMENT

After having considered all aspects of the Proposals, the Board is of the opinion that the Proposals are in the best interest of the Company.

11. APPLICATION TO THE RELEVANT AUTHORITIES

An application to the relevant authorities seeking approval for the Proposals is expected to be made within one (1) month from the date of this announcement.

12. ADVISER

Kenanga IB has been appointed to act as the Adviser to the Company for the Proposals.

This announcement is dated 14 June 2017.

(I) PROPOSED BONUS ISSUE OF UP TO 2,804,471,128 · PDF filewith regards to the Proposed Bonus...

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Transcript of (I) PROPOSED BONUS ISSUE OF UP TO 2,804,471,128 · PDF filewith regards to the Proposed Bonus...