SINGAPORE - Mainboard-listed entertainment group mm2 Asia is planning to raise up to S$35 million from the issue of some 1.8 billion shares via a 1-for-2 rights issue to strengthen its financial position and grow its business.

At 2 cents, the rights shares are now priced at a 50 per cent discount to the firm’s share price close at 4 cents last Friday.

Tycoons Oei Hong Leong, who owns an 8.45 per cent stake in mm2, and “popiah king” Sam Goi, who owns a 6.81 per cent stake in the company, are underwriting the issue and will take up all unsubscribed rights shares.

This is in addition to their respective 118 million and 95 million rights shares entitlements.

mm2 said on Saturday it expects to receive net proceeds of approximately $34.9 million under the Maximum Subscription Scenario and approximately $27.3 million under the Minimum Subscription Scenario, after deducting estimated expenses of approximately $600,000.

Between 50 to 60 per cent of the money raised will be used to pay down its debt, while the balance will go towards working capital.

The company has outstanding exchangeable bonds amounting to some $85 million.

The company said the fundraising would enhance its ability to formulate, strategise and execute its business plans to capture the continued recovery of all its business segments, while also strengthening its financial position by augmenting its balance sheet and capital base, and paring down borrowings and gearing.

“While the Group has yet to return to pre-pandemic numbers, the results have been encouraging,” it said.

“The road to full recovery and beyond is within sight. The company’s core content creation business grew by 38 per cent to $101.3 million in FY2023, setting a new revenue record and surpassing the previous revenue record for the core business of $99.5 million back in pre-...