ZHONGSHENJIANYE (02503) has announced that its board of directors recommends increasing the company's authorized share capital. The proposal involves creating an additional 3 billion unissued shares with a par value of HKD 0.01 each. This would raise the total authorized capital from HKD 20 million, represented by 2 billion shares of HKD 0.01 each, to HKD 50 million, represented by 5 billion shares of HKD 0.01 each.

Concurrently, the board proposes a rights issue. The offering is structured on the basis of 2 rights issue shares for every 1 existing share held by eligible shareholders on the record date. A total of up to approximately 2.289 billion new shares will be issued under the rights offer at a subscription price of HKD 0.15 per share.

Assuming full acceptance of the rights issue and no change in the total number of issued shares before the record date, the maximum net proceeds are estimated to be approximately HKD 341.3 million.

The company intends to allocate the net proceeds from the rights issue as follows: approximately 66.0% will be used to meet the funding and cash flow requirements for several recently awarded projects. The group expects to fully utilize this portion of the proceeds by the end of 2027. Approximately 20.0% of the net proceeds are earmarked for debt repayment, covering items such as trade payables, other payables, and accrued expenses. The group anticipates fully using these funds for debt repayment by the end of 2026. The remaining 14.0% of the net proceeds will serve as general working capital for the group, covering employee costs, rental expenses, legal and professional fees, and other operational expenditures. The group plans to fully deploy this portion by the end of 2027.