Mega Financial Holding Co (兆豐金控) has raised NT$21.5 billion (US$724 million) in funds through a rights issue in a bid to strengthen the capital structure of its banking operations.
Mega Financial issued 1 billion new common shares for the fund raising activity at NT$21.5 per share. After raising the funds, the financial holding company’s paid-in capital has risen to NT$124.5 billion.
The newly issued shares are scheduled to be listed on the Taiwan Stock Exchange on Thursday, the financial holding said.
In an attempt not to dilute the shareholding by the existing government-related shareholders, Mega Financial said the buyers largely came from the legal entities under the government and government-run funds.
Mega Financial said it will assign NT$15 billion to boost the first-tier capital of the flagship Mega International Commercial Bank (兆豐國際商銀) for business expansion, while it will use the remaining NT$6.5 billion as the financial holding company’s working capital.
On its Web site, Mega Bank said it runs 108 branches throughout Taiwan, while running 21 branches and three representative offices overseas. The bank is focusing on the Asia-Pacific market, and plans to open more branches in China, Vietnam, Cambodia and Myanmar.
The financial holding company said since its announcement that it would make a rights issue on Aug. 27, its share price has risen to NT$25.25 from NT$22.65, up 11.48 percent, outpacing an increase of 7.06 percent the broader market enjoyed during the same period.
Market analysts said the gains posted by Mega Financial shares in recent sessions showed investors have been upbeat about the company’s earnings outlook on the back of its strength in foreign exchange businesses and warming financial exchanges between Taiwan and China.
According to Mega Financial, foreign institutional investors owned a 27.56 percent stake in the company as of Friday, up from 24.93 percent recorded in late August.
In the first nine months of this year, Mega Financial posted NT$1.59 in earnings per share, compared with NT$1.55 recorded over the same period of last year.