Tess Agro announces rights issue to settle bank borrowings

Fisheries products exporter Tess Agro on Wednesday disclosed plans to raise Rs.59 million via a rights issue.

The company said its board of directors resolved to issue 70 million ordinary voting shares priced at 80 cents in the proportion of a new share for every four shares held and 10 million shares of ordinary non-voting shares priced at 30 cents in the same proportion. 

The company said the proceeds of the rights will be utilized to settle bank borrowings and the excess for working capital needs.

As at September 30, 2017, Tess Agro had interest-bearing loans and borrowings of Rs.143.8 million and bank overdrafts of Rs.45.8 million under current liabilities. The company’s net asset value per share as per the same date stood at 65 cents and the stated capital of the company is Rs.356.9 million.

The Tess Agro share was last traded at Rs.1.10.

The company said the rights issue is subjected to the shareholder and Colombo Stock Exchange approving the listing of shares in principal.