Unionmet (Singapore) is proposing a one-for-two rights issue at 7.5 cents apiece to raise about $23 million.
It has earmarked $20 million of the net proceeds to fund its new property development and oil blending businesses.
The remainder will be used for general working capital purposes.
The new property development business and the oil blending business are in line with the group's strategy to provide shareholders with diversified returns and long term growth.
The rights shares are priced at about 3.8 per cent discount to the closing price of 7.8 cents on Jan 10.
The rights issue is non-underwritten.