SILKWAVE INC (00471) plans to issue new shares at a discount of approximately 31.06% on the basis of "1 share for every 3 shares held".

SILKWAVE INC (00471) announced that the company proposes a rights issue at a ratio of 1 for every 3 existing shares, at a discount of approximately 31.06% at a subscription price of HK$0.455 per share, (i) issuing up to 359,821,602 new shares to raise up to approximately HK$1.637 billion (assuming full subscription and no change in the number of shares issued before the record date); or (ii) issuing up to 383,161,602 new shares to raise up to approximately HK$1.743 billion (assuming full subscription and no change in the number of shares issued before the record date, except for the conversion of all convertible notes before the record date). After deducting all relevant expenses, the estimated net proceeds from the rights issue are (i) approximately HK$1.62 billion (assuming full subscription and no change in the number of shares issued before the record date); or (ii) approximately HK$1.726 billion (assuming full subscription and no change in the number of shares issued before the record date, except for the conversion of all convertible notes before the record date). Approximately 33.5% will be used for technical development and infrastructure upgrades for the CMMB business; approximately 29.2% will be used for trade business; approximately 8.4% will be used to strengthen the operational team and business development for CMMB business and trade business; approximately 4.2% will be used for marketing activities and devising promotional plans for new clients; approximately 16.3% will be used for general working capital of the group; and approximately 8.4% will be reserved for potential suitable investment opportunities.