BURSA ANNOUNCEMENTS

NEW ISSUE OF SECURITIES (CHAPTER 6 OF LISTING REQUIREMENTS) FUND RAISING

Date Published : 2018-12-06

We refer to the Company’s announcements dated 23 August 2017, 10, 16 October 2017, 18, 22 December 2017, 19 February 2018, 5 March 2018, 5, 20 April 2018, 25 July 2018 and 1 August 2018 in relation to the Rights Issue with Warrants ("Announcements").

Unless otherwise stated, the abbreviations and definitions used throughout this announcement shall have the same meaning as those previously defined in the Announcements.

On behalf of the Board, TA Securities wishes to announce that the Board has resolved to fix the following:

The Issue Price was determined and fixed by the Board after taking into consideration, amongst others, the following:-

(i) the historical share price movements of Mycron Shares for the past twelve (12) months;

(ii) the minimum amount to be raised from the Rights Issue with Warrants of approximately RM10.80 million; and

(iii) a premium of approximately 4.57% to the five-(5) day volume weighted-average market price ("5D-VWAMP") of Mycron Shares up to and including 5 December 2018, being the last trading day of the Mycron Shares immediately preceding the price-fixing date of 6 December 2018 ("Price-Fixing Date") of RM0.2869; and

(iii) a premium of approximately 3.78% to the theoretical ex-rights price ("TERP") of Mycron Shares of RM0.2891 calculated based on the 5D-VWAMP of Mycron Shares up to and including 5 December 2018, being the last trading day of the Mycron Shares immediately preceding the Price-Fixing Date of RM0.2869.

The Board had fixed the Exercise Price of the Warrants after taking into consideration the following:-

(i) a premium of approximately 109.13% from the 5D-VWAMP of Mycron Shares up to and including 5 December 2018, being the last trading day of Mycron Shares immediately preceding the Price-Fixing Date of RM0.2869; and

(ii) a premium of approximately 107.55% to the TERP of Mycron Shares of RM0.2891 calculated based on the 5D-VWAMP of Mycron Shares up to and including of 5 December 2018, being the last trading day immediately preceding the Price Fixing Date of RM0.2869.

At the Issue Price, the Rights Issue with Warrants will raise between approximately RM10.80 million and RM17.01 million based on the following scenarios, with the following intended utilisation: -

Proposed Utilisation	Expected time frame for utilisation of proceeds from the date of listing of the Rights Shares	Minimum Scenario (RM’000)	Maximum Scenario (RM’000)
Capital expenditure(1)	Within 12 months	10,100	10,100
Working capital(2)	Within 12 months	-	6,213
Estimated expenses in relation to the Rights Issue with Warrants(3)	Within 1 month	700	700
Total		10,800	17,013

Notes: -

(1)The Board has approved RM50.0 million for its capital expenditure plans for its wholly-owned subsidiary MSCRC planned revamp of its aging Continuouse Pickling Line and the construction of a new Acid Regeneration Plant. The Group intends to utilise up to RM10.10 million of the proceeds raised from the Rights Issue with Warrants to partially finance the above-mentioned capital expenditure. The balance of the capital expenditure is expected to be funded via bank borrowings of approximately RM35.0 million and internally-generated funds of approximately RM4.9 million.

The Continuous Pickling Line is the first stage of the cold-rolled-coil manufacturing process, where the raw material hot-rolled coils is subjected to an acid-bath to be pickled and de-scaled for a clean surface before moving to the next processing stage. The acid used in the aforementioned process loses its concentration and needs to be topped-up and replaced regularly. The objective of the new Acid Regeneration Plant is to retreat the ‘used acid’ for use again in the pickling process in a closed-loop manner. The Acid Regeneration Plant is expected to reduce acid consumption by 95% per year; whilst, the revamp of the Continuous Pickling Line which entails extensive replacement of machine and equipment would significantly extend the economic useful life of the line.

(2) If available, the Group intends to utilise up to RM6.21 million of the proceeds raised from the Rights Issue with Warrants to finance the working capital of its wholly-owned subsidiaries, MSCRC and/or at the proportion deemed fit in relation to their purchase of raw material coils, and credit sales financing needs.

(3)The estimated expenses in relation to the Rights Issue with Warrants consist of professional fees, fees payable to the relevant authorities, expenses to convene the EGM and other ancillary expenses. Any surplus or shortfall for the estimated expenses in relation to the Rights Issue with Warrants shall be adjusted accordingly against the allocation for the working capital of MSCRC and/or MST.

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