19th Jun 2014 14:18
LONDON (Alliance News) - Adamas Finance Asia Ltd Thursday said it has entered into agreements to raise USD2.2 million by issuing 31.6 million new shares to new investors at a price of USD0.07 each, as it continues to take shape after its reverse takeover by credit fund Elypsis Solutions Ltd in December.
All shares subsequently will be consolidated on a one-for-ten basis, and the company also offered all its warrant holders one pre-consolidated for every four warrants held.
Adamas Finance Asia shares were untraded Thursday. They were last quoted at USD0.08.
"Prior to the [annual general meeting], the company expects to be able to announce that it has entered into further subscription agreements on the same terms as the subscription agreements," the company said in a statement, referring to its July 11 AGM.
Adamas Finance Asia, which changed its name from China Private Equity Investment Holdings Ltd after a reverse takeover in February, also said it is making the warrant conversion offer because having a high number of warrants outstanding could constrain its ability to raise equity funding in the future as new investors might be deterred by the potential dilution from the warrants.
Under Adamas Finance Asia's reverse takeover in December, it agreed to issue 722.7 million warrants exercisable at USD0.06 each for shares in the company on top of an issuance of 1.45 billion shares in the company at USD0.06.
The company agreed with Elypsis to acquire interests in four special purpose vehicles with stakes in four domestic Chinese businesses - CJRE, Global Pharm, HKMI and Meize Energy. Elypsis is owned by Asia Private Credit Fund Ltd, managed by an affiliate of Hong Kong-based Adamas Asset Management HK Ltd.
Adamas Thursday said that Elypsis has agreed to exchange its warrants for pre-consolidation shares so long as the necessary resolutions are passed at the company's AGM.
If all warrant holders accept the offer and the subscription agreement is completed in full, Elypsis and Asia Private Credit Fund will hold an 84.62% stake in the company. If no warrantholders but Elypsis accept the offer, the Elypsis holding will be 85.32% of the new shares.
Elypsis currently holds an 85.15% stake in the company. It has already said it will vote in favour of all of the resolutions to be proposed at the AGM, with the exception of the warrant offer to it. Warrantholders who do not accept the offer will retain their warrants. Those with fewer than 40 warrants won't receive any new shares due to the share consolidation should they accept the offer.
Also at the July 11 AGM, shareholders will be asked to approve a previously announced change of investing policy that will change the average maturity of transactions it makes to range from six to 24 months, instead of the current range of 24 to 36 months. The amendment is designed to enable the company to invest in and realise shorter-term investments being identified by Adamas Asset Management (HK).
By Samuel Agini; [email protected]; @samuelagini
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