SINGAPORE - United Food Holdings said on Tuesday (Nov 29) that the firm is proposing to reduce the par value of each share to 10 Hong Kong cents, to reorgaanise its share capital.
The firm said the move will give it "greater flexibility to issue new shares in the future should fund raising opportunities or requirements arise".
The company's shares have been trading between approximately S$0.025 (equivalent to HK$0.137) and S$0.055 (equivalent to HK$0.302), which is below the existing par value per share of HK$2.50 in the three months to Nov 14.
The company is incorporated in Bermuda. Under the laws of Bermuda, which - unlike certain other jurisdictions such as Singapore - have yet to abolish the concept of par value, shares of a Bermuda company may not be issued for an amount less than the par value of the shares.
Now, the firm's share capital of HK$500 million is divided into 200 million shares, of a par value of HK$2.50 each, of which about 110 million shares have been issued, fully paid or credited as fully paid.
If the proposal takes place, the issued share capital will be reduced from HK$275.2 million to HK$11 million, and the share premium account will be reduced from HK$475 million to zero.