31st January 2025, Kathmandu
City Hotel is moving forward with an 80% rights share issue to its existing shareholders. The company plans to use the proceeds for debt repayment and strengthen its financial standing.
City Hotel 80% Rights Issue
At the 9th Annual General Meeting (AGM) held on 10 January, shareholders approved a special proposal for the rights issue. The company will offer shares in a 1:0.80 ratio, meaning shareholders will have the option to buy 0.80 shares for every share they currently own.
Prabhu Capital Appointed as Sales Manager
To manage the rights issue process, City Hotel has appointed Prabhu Capital as the sales manager. Both companies have signed an agreement to handle the distribution and sale of the rights shares.
Rationale Behind the Rights Issue
The hotel’s management decided to initiate the rights issue primarily to raise funds for repaying its debts. This decision is part of the company’s strategy to improve its financial stability and reduce its liabilities. The rights issue will allow existing shareholders to acquire additional shares, thereby increasing their stake in the hotel.
Financial Benefits for Shareholders
The rights issue is expected to provide a boost for City Hotel’s shareholders. Those participating in the rights issue will be able to purchase shares at a favorable ratio, offering them a chance to increase their holdings at a discounted price.
Steps Toward Financial Strength
This rights issue is a critical part of City Hotel’s plan to enhance its financial structure. The funds raised will allow the company to address its debts while offering shareholders a chance to benefit from the growth of the hotel.
Key Information:
80% rights share issue approved
Offered at a 1:0.80 ratio
Prabhu Capital appointed as sales manager
Primary purpose: Debt repayment and financial stability
City Hotel’s decision to issue rights shares reflects a strategic move to secure its financial future. By involving shareholders and appointing a trusted sales manager, the hotel is taking steps to manage its financial obligations and improve its standing in the market.
