BIMB to raise RM796m in share offering

The placement was oversubscribed with demand from both existing shareholders and new investors


BIMB Holdings Bhd plans to raise up to RM795.6 million by placing out 222.22 million new shares or 12% of its total issued share capital as part of the financial group’s restructuring exercise.

The new shares are priced at RM3.58 per share, which is a discount of 9.4% to the volume-weighted average price for five market days including RM3.95 on Monday.

In a filing to Bursa Malaysia, BIMB noted the book building exercise was completed yesterday.

“The placement was oversubscribed with demand from both existing shareholders and new investors,” Maybank Investment Bank Bhd stated in the filing.

Trading in BIMB shares was suspended yesterday on the company’s request pending the announcement.

BIMB is the second lender on the local stock exchange this year to decide on share placement to raise capital after AMMB Holdings Bhd (AmBank) announced similar plans nearly two weeks ago.

AmBank’s proposal to raise an estimated RM810 million via private placement of 300 million new shares or 9.97% of its current share capital comes after the bank agreed to pay RM2.83 billion to the government for its involvement in the 1Malaysia Development Bhd scandal.

BIMB first announced the restructuring exercise in December 2019. It implies the transferring of BIMB’s listing status to its wholly-owned subsidiary, Bank Islam Malaysia Bhd.

The exercise was supposed to be completed in August last year, however, delays due to the Covid-19 pandemic had pushed plans back to the first quarter of this year.

Under the plan, Bank Islam (M) Bhd will also take over BIMB Securities and Syarikat Takaful Malaysia Keluarga Bhd, in which BIMB holds a 59.45% interest. Syarikat Takaful will remain as a listed entity upon completion of the exercise.

Lembaga Tabung Haji is the controlling shareholder of BIMB, holding a 53.14% stake in the group. Other substantial shareholders are the Employees’ Provident Fund with a 12.24% stake, Permodalan Nasional Bhd (10.93%), Yayasan Pelaburan Bumiputera (5.07%) and Retirement Fund (Inc) (2.65%). BIMB’s share price has declined by 8.4% or 36 sen year-to-date from RM4.30 at the start of the year, wiping out about RM650 million from its market valuation.

BIMB shares last traded at RM3.94, valuing the company at RM7.3 billion.