Bursa Malaysia has approved Borneo Oil Bhd’s rights issue with free warrants, enabling it to raise RM223.39 million ($57.84 million) to expand its gold mining in Peninsular Malaysia.

Its corporate exercise involves the proposed issuance of 2.37 billion rights shares on the basis of six rights shares for every one share held and 1.18 billion free warrants C on the basis of one warrant C for every two rights shares held. Borneo Oil said by expanding its gold mining activities, this could raise its net profit to more than 25 per cent in the future.

“With the addition of the gold mining business starting to come to fruition, these positive developments augur well for the company’s financial performance,” said Borneo Oil executive director Raymond Teo.

The cash call expects to raise RM223.39 million based on the indicative issue price of 10 sen per renounceable rights share. The indicative issue price of 10 sen per rights share is a discount of about 33 per cent to the theoretical ex-rights price of its shares of 15 sen based on its closing price of 61 sen per share on July 24, 2015.

Victoria Ltd owns 25.48 per cent and Hap Seng 16.72 per cent of Borneo Oil and both pledged to subscribe for the rights shares.