KUALA LUMPUR: Aizo Group Bhd, formerly Minetech Resources Bhd, saw its share price tumble to a two-year low today as investors reacted poorly to its latest fundraising proposals.
The engineering and construction services counter opened 7.1 per cent or half a sen lower at 6.5 sen before sliding further to close the midday session at 4.5 sen, down 2.5 sen or 35.7 per cent – its lowest since Nov 24, 2023.
By 12.30pm, Aizo was the most actively traded stock on Bursa Malaysia with 58.1 million shares changing hands, its highest in nearly six weeks and almost 12 times its 200-day average of 4.9 million shares.
At 4.5 sen, the Main Market-listed company is valued at RM88.36 million. Year-to-date, the stock has plunged 65 per cent from its opening price of 13 sen on Jan 2.
Aizo provides specialised civil engineering services, manufactures and trades bituminous products, and offers manpower and maintenance services, among others.
The company has proposed to raise nearly RM200 million through a private placement exercise and a rights issue.
Under the private placement, Aizo plans to issue up to 763.88 million new shares, representing 30 per cent of its issued share capital, to raise as much as RM46.6 million.
Of this, RM40 million will be used for the development of its large-scale solar facility in Kampar, Perak, while RM5.59 million has been earmarked for working capital, including staff costs and other operating and administrative expenses.
As part of the exercise, executive chairman Datuk Abang Abdillah Izzarim Abang Abdul Rahman Zohari will be allocated 100 million shares.
Executive director Ahmad Rahizal Datuk Ahmad Rasidi and executive director for finance and technology Emma Yazmeen Yip Mohd Jeffrey will each subscribe for 15 million shares.
The remainder will be placed out to third-party investors.
Aizo's one-for-one rights issue is expected to raise up to RM148.96 million through the issuance of 3.31 billion rights shares. The proposal also includes up to 1.66 billion warrants on the basis of one warrant for every two rights shares subscribed.
The board has set a minimum subscription level to raise at least RM10.94 million, based on an indicative issue price of 4.5 sen per rights share.
Abang Abdillah Izzarim and Emma Yazmeen Yip have committed to subscribe for at least 222.22 million and 21 million rights shares, respectively.
Aizo added that if shareholders do not approve the private placement at an upcoming EGM, the group will proceed with the rights issue alone.
Proceeds from the rights issue will be used to fund ongoing and future construction projects, strengthen working capital, support new business ventures and drive digitalisation initiatives across the group.
Separately, the company has proposed a RM75 million share capital reduction to offset its RM46.26 million in accumulated losses as at June 30, 2025. The move will leave the group with a retained profit of RM26.86 million at the group level.