New City Construction and Development (00456) announced that on September 6, 2023, the company signed an agreement with the purchaser, Mr. Han Junran. According to this, the purchaser conditionally agreed to subscribe, and the company conditionally agreed to distribute and issue 307.02 million new shares for all capitalized shareholder loans, which is equivalent to about 26.19% of the company's issued share capital after expansion. The issue price was HK$0.57 per share, which is approximately 5.00% off the closing price of HK$0.60 per share on September 6.
After completion of capitalization, the total proceeds from capitalization will be HK$17.5 million and will be used to offset all shareholder loans of HK$17.5 million at the time of completion. The purpose of capitalization is to reduce part of the company's debt and improve the company's financial position and balance level.