Singapore-based First Ship Lease Trust is looking to raise SGD 43.03 million (USD 31.3 million) through a pro rata, non-renounceable and non-underwritten preferential offering.
The company said that 956.2 million of new units in FSLT would be offered at the ratio of three rights units for every two existing units in FSLT.
FSL Trust informed that the offering would provide unitholders with the opportunity to subscribe for their pro rata entitlement to the new units at an issue price of SGD 0.045 per unit, which is a discount of 31.8% to the closing price of SGD 0.066 per unit in FSLT on the Singapore Exchange Securities Trading Limited on November 26, 2018.
The offering would strengthen the financial position and capital base of FSLT, enhancing its financial flexibility to renew its ageing fleet, therefore reducing the age profile and enhancing its commercial attractiveness and marketability. The move would also increase FSLT’s market capitalization, potentially improving the trading liquidity of the units after the offering, as well as provide the unitholders with an opportunity to further participate in the equity of FSLT.
The company explained that fleet renewal would be undertaken through the acquisition of new and/or more recently build vessels to meet anticipated market conditions.