Landing International floats capital reorganization idea

Landing International floats capital reorganization idea

Hong Kong-listed casino investor Landing International Development Ltd. (LIDL) is considering capital reorganization and changes in board lot size to make the company more appealing to investors.

Landing International floats capital reorganization ideaIn a regulatory filing, LIDL announced that its board of directors is set to propose the capital reorganization comprising of a 50-to-1 share consolidation and capital reduction.

The capital reorganization will result in the reduction of the number of issued shares from 146,744,935,542 shares to 2,934,898,710 consolidated shares. The par value of each issued share will remain at HK$0.01 (US$0.00127), according to the company.

LIDL also dangled the idea of changing the board lot size for trading on the Hong Kong Stock Exchange from 60,000 shares to 1,200 new consolidated shares as soon as the capital reorganization become effective.

“Subject to certain conditions, including obtaining shareholders’ approval, the company anticipates that the Capital Reorganization will take effect on 4 July 2018,” LIDL said in a statement.

In pushing for the capital reorganization, LIDL pointed out the need for broader base of “institutional and sophisticated investors” in order to reduce the volatility of the company’s share price.

The firm also believes that keeping the par value of its shares low will provide greater flexibility in setting the issue price for future equity fund raising exercises.

As for the board lot size changes, LIDL said the move will help maintain the trading amount for each board lot at a reasonable level for the public to invest in its new shares.

LIDL, which operates the Jeju Shinhwa World casino resort on South Korea’s Jeju island, reported a HK$505.1 million ($64.55 million) profit in 2017 from a loss of HK$1.1 billion ($140.58 million) in 2016.

The company attributed its profit swing to the stellar performance of its property development segment—including the sale of condominium units at Jeju Shinhwa—and the disposal of Les Ambassadeurs Club and Casino, an upmarket gaming venue in London.

LIDL had earlier announced plans to build an “integrated leisure and entertainment resort” in Paranaque City, and has already signed a lease for 9.5 hectares (23.75 acres) of land.