Genting loses RM1.6bil in market value after cash call
Genting Bhd shares dropped significantly after the company announced a rights issue to raise RM1.25 billion. Investors expressed concerns regarding debt levels and potential earnings dilution.
Why it matters
Large-scale capital raising efforts by major conglomerates can significantly impact market stability and investor confidence in the regional economy.
PETALING JAYA: Genting Bhd shares plunged to a near two-decade low as investors balked at its proposed RM1.25bil rights issue, with concerns mounting over potential earnings dilution and whether the fundraising would do enough to ease the group’s hefty debt burden.
The sell-off prompted Bursa Malaysia to suspend intraday short selling (IDSS) in the stock for the rest of the day after its price fell beyond the prescribed threshold of 15% or 15 sen from its reference price.
IDSS is scheduled to resume today, the stock exchange operator said in a filing.
At market close, Genting shares fell 43 sen, or 22.87%, to RM1.45, wiping more than RM1.6bil off its market capitalisation.
At yesterday close, the stock’s market cap stood at RM5.58bil.
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