An increase in company’s capital is usually an unpleasant news for stockholders/investors because it could lead to a stock dilution, which dilutes the value of investors’ existing shares. But in the case of ATP30 Public Company Limited (ATP30) is different .
ATP30 announced the capital increase by offering 65 million newly issued shares or equivalent to 9.53% to a specific person (PP) namely Toyota Tsusho Thai Holdings Company Limited (TTTH) at the offering price of 0.99 baht per share, representing a total value of 64.35 million baht, bringing TTTH to become the 2nd major shareholder of ATP30.
Despite the offering price is lower than market price, ATP30 still spiked nearly 14% to close at ฿1.16/share with a total trading value of 35 million baht.
Probably, ATP30’s share spiked against market expectations because the key objective of capital increase was to prepare for the future business expansion unlike other companies. Normally, issuing newly issued ordinary shares reflects the needs of using money whether for debt payment or maintaining healthy business.
As a consequence of Covid-19 pandemic, many ATP30’s factories have to close. Meanwhile the tie-up with Raja Ferry Port Public Company Limited (RP) to provide travel and passenger transport services is likely not working out because of the outbreak.
To partner with TTTH, ATP30 will obtain synergy benefits from TTTH and its affiliated companies by giving access to more customer bases, offsetting the loss from ongoing pandemic.
ATP30 also will receive a technology to develop the model smart mobility carriage management system, as well as a sharing network to expand the market and reduce cost.
And most importantly, ATP30 will book additional 64.35 million baht to its liquidity, budgeting for the future investment.