Investment solutions firm iFast Corporation has boosted its stake in its associate company, Pecuniam, via a rights issue as it seeks to tap business opportunities in India.
It has subscribed for around 3.58 million new shares at an issue price of 22 cents apiece or about $788,000. This lifts its stake in Pecuniam from 21.42 per cent to 24.98 per cent.
The issue price represents a 10 per cent premium to the equivalent share price of Pecuniam based on the last transacted price of iFast Financial India (IFI).
Pecuniam is an investment-holding company that owns Singapore-incorporated iFast India Investments, which in turn owns a 74.99 per cent stake of IFI.
IFI is an India-incorporated company engaged in the distribution of investment products, including mutual funds, in India.
Pecuniam will utilise the net proceeds of the rights issue for the purpose of its working capital and the growth of the business, iFast highlighted in a filing to the Singapore Exchange on Monday night.
"The group believes the rights issue allows opportunities to tap on India's potential strategic role in terms of providing business opportunities to the rest of the group," iFast said in a statement.
The transaction is not expected to have any material impact on the group's earnings per share and net tangible assets per share for the financial year ending Dec 31, 2018.