JAKARTA. PT Smartfren Telecom Tbk (FREN), a telecommunication service company under Sinarmas Group, will initiate the increase of its capital by giving pre-emptive rights, or also known as rights issue.

The management of FREN said that the number of shares that will be offered in rights issue is set to a maximum of 234 billion shares. These new shares are common shares called Series D shares worth IDR 50 each.

FREN will ask for approval to its shareholders during the Extraordinary General Meeting of Shareholders (EGMS) that has been scheduled to take place on November 24, 2023. The rights issue is estimated to take place no later than 12 months after the company secures approval from its shareholders.

“The company intends to use the proceeds of the fifth rights issue, after deducting emission costs, to pay off outstanding loans owed by the company, and/or increase the working capital of the company and/or its subsidiaries,” the management of FREN explained in the official disclosure.

For the record, this corporate action will make FREN’s investors’ portions diluted by up to 41.1% if they choose not to participate in the upcoming rights issue. (KR/ZH)