Ta Yang Group Holdings Limited (Stock Code: 1991) has unveiled proposals for a Capital Reorganisation and a Rights Issue. The Capital Reorganisation aims to reduce the par value of each issued share from HK$1.00 to HK$0.10, followed by a subdivision of each unissued share into ten new shares of HK$0.10 each. Any credit arising from this reduction would be used to offset accumulated losses and potentially transfer any remaining balance to a distributable reserve.

Under the proposed Rights Issue, the company plans to offer two rights shares for every one new share held on the record date, at a subscription price of HK$0.80 per rights share. The maximum funds raised could reach approximately HK$275.21 million or up to approximately HK$300.11 million if existing convertible bonds are fully converted before the record date. After deducting expenses, net proceeds are estimated to be up to around HK$274.48 million or HK$299.38 million.

According to the announcement, the net proceeds will largely finance the development of AI Digital Human technology, covering computing infrastructure, data training, and recruitment of specialized staff. A portion of the proceeds is also allocated for general working capital and repayment of outstanding debts. The proposed Rights Issue does not have a minimum subscription level and will be conducted on a non-underwritten basis. If investor participation is low, the size of the issue will be reduced accordingly.

The company stresses that both the Capital Reorganisation and the Rights Issue are subject to approvals, including shareholder resolutions at an extraordinary general meeting, as well as listing approval of the new shares by the Hong Kong Stock Exchange. If the necessary conditions are not met, these proposals may not proceed. Investors are advised to review the prospectus and exercise caution in dealing in the company’s shares, given that the Rights Issue may not become unconditional or may not move forward if the conditions are not satisfied.