Bangkok, 20 February 2024 – The Securities and Exchange Commission (SEC) urges the shareholders of More Return Public Company Limited (MORE) to study information, attend the upcoming extraordinary general shareholders’ meeting on 23 February 2024 and exercise their voting rights on a proposed capital increase to be offered to the existing shareholders in proportion to their shareholding (rights offering). The independent financial advisor (IFA) considers that the information disclosure in this case is insufficient, and the company is exposed to the risk of absence of due diligence in the accounting, legal and tax areas of the target investee company and the potential dilution effect.* The IFA thus advises against the approval of the proposed capital increase.  

MORE will propose the capital increase of 1,076.51 million baht at the extraordinary general shareholders’ meeting on February 23, 2024. This would raise the current registered capital of 358.84 million baht to 1,435.35 million baht. The plan involves offering 21,530,245,323 common shares at 0.05 baht per share to the existing shareholders in proportion to their shareholding (rights offering), up to a maximum of 14,353,496,882 shares. Additionally, there will be shares allocated for the exercise of rights through warrants (MORE-W3), amounting to 7,176,748,441 shares. If the existing shareholders choose not to purchase common shares and do not receive the allocation of MORE-W3 shares, there will be a control dilution, constituting 75 percent of the total voting rights. In addition, if the shareholders fully exercise their right to purchase common shares but do not exercise the convertible right of MORE-W3, there will be a price dilution, accounting for 60.29 percent of the share price before offering. 

IFA considers that the shareholders should not approve the proposed transaction of common share offering at this time because the plan for utilizing the increased common shares lacks clear assessment of the reasonableness of the capital increase, project feasibility, and cost-effectiveness of the investment due to limitations on information disclosure under a confidentiality agreement related to investment. For example, information on the list of shareholders, financial statements and sources of income of the target company, etc., is not provided. Additionally, MORE is exposed to the risk of absence of due diligence in the accounting, legal and tax areas of the target investee company and the dilution effect at a ratio of 1 existing common share to 2 new common shares for the capital increase at a rate of 0.05 baht per share, which is lower than the average market price of 0.17 baht per share before the offering.

However, the company's board and audit committee have acknowledged the various risks and impacts arising from limitations that prevent the exact amount of proceeds to be determined. This transaction is a desire and demand from minority shareholders who wish for the company to seek new business opportunities or undertake actions to generate returns which will be reflected in the securities price or provide good returns to shareholders. The potential impacts and risks to shareholders from the dilution effect mechanism would contribute to aligning the company's organizational and/or financial structures with changing circumstances appropriately and also enhance opportunities for the company's business operations.

In light of this, the SEC recommends that MORE shareholders carefully review detailed information, analyze the pros and cons, benefits, and impacts of approving or rejecting the proposed transaction, and exercise their shareholder rights to protect their own interests. Shareholders are also encouraged to engage with the company’s management to obtain comprehensive information for informed decision-making.

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Remark: * Dilution effect refers to the impact on shareholders resulting from the offering for sale of shares such as the impact on the market price (price dilution) or the impact on voting rights (control dilution).