Thailand’s SSI raises $351m in capital increase plan

Sahaviriya Steel Industries (SSI), Thailand’s biggest steelmaker, has generated about 11 billion baht ($351 million) through a fund-raising programme, it said on Wednesday October 16.

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In the last of nine regular reports on its Capital Increase Plan, the company said that 9.4 billion baht ($300 million) was raised through issuance of new shares between November 16, 2012, and October 10 this year.

But this was about $122 million less than it had hoped to raise.

SSI’s Capital Increase Plan had allowed the issuance of new share capital up to around 19.4 billion new shares at 0.68 baht (2 cents) per share.

Of that amount, only about 13.8 billion shares were issued. The remaining 5.6 billion shares, equivalent to around $122 million, were unsubscribed, which the company said it will later reduce its authorized capital by cancelling the number of unsubscribed shares.

A further 1.6 billion baht ($51 million) was raised through the sale of shares in its cold rolling plant, Thai Cold Rolled Steel Sheet (TCRSS).

The plan’s proceeds are being used to make further investments in its iron and steelmaking business in the UK and to buy back convertible bonds, SSI said.

Including these additional investments, the paid-up capital in SSI UK has risen to $895.6 million from $473 million, according to SSI group ceo and president Win Viriyaprapaikit.

“This will help SSI UK to reduce its costs and provide the working capital required as it continues to ramp up output,” he said.

“We had strong support for our fund-raising activities from our shareholders and business partners, who showed their confidence in our business, our vision, our management and our people,” he added.

“We hope to regain our financial strength as our energy costs continue to reduce since the start-up of our pulverized coal injection plant in July, and our business stabilises as the plant achieves economies of scale in terms of output level,” he explained.

In its latest financial report, SSI continued to show a loss, reporting a deficit of 887 million baht ($28.3 million) in core earnings for the three months ending on June 30, 2013.