Genting Plans MYR1.25bn Rights Issue to Cut Debt

Genting unveils MYR1.25 billion rights issue

Genting Berhad has proposed a renounceable rights issue aimed at raising gross proceeds of approximately MYR1.25 billion, or about US$306 million. The fundraising is positioned as a balance-sheet measure, with the group setting out a detailed allocation of how the new capital will be used across debt repayment, working capital and transaction-related costs.

The company plans to allocate MYR800.0 million of the proceeds to repay borrowings, MYR429.5 million to fund working capital and MYR20.5 million to cover expenses associated with the rights issue. Genting stated that the MYR800.0 million earmarked for loan repayment is expected to generate potential annual interest savings of MYR41.3 million, based on weighted interest rates as at 30 June 2026.

As of 30 June 2026, Genting Berhad and its subsidiaries reported total borrowings of just over MYR45.25 billion. This comprised nearly MYR9.68 billion of short-term borrowings and about MYR35.58 billion of longer-term borrowings, highlighting the scale of the group’s existing debt load relative to the planned capital raising.

Support from Lim-family shareholders

The rights issue is backed by major shareholders linked to the Lim family. Investment vehicles Kien Huat Realty Sdn Bhd, Kien Huat International Ltd and Lim Keong Hui have each provided irrevocable undertakings to subscribe for their full entitlements under the proposed exercise.

Collectively, these Lim-family entities account for about 45.1% of the proposed rights issue. Their commitment provides a significant anchor for the transaction and reduces execution risk for the capital-raising exercise, though the remaining portion will still need to be taken up by other investors or through underwriting arrangements.

Analyst reaction highlights limited deleveraging

Initial analyst commentary has focused on the modest impact of the rights issue on Genting’s leverage and future earnings. Maybank Investment Bank downgraded Genting to a ‘Sell’ rating, stating that the proposed exercise offers only limited debt relief in the context of the group’s more than MYR45 billion of borrowings.

Maybank estimated that the capital raising would reduce Genting’s net gearing by around two percentage points, suggesting that substantial debt would remain on the balance sheet even after the transaction. The bank also highlighted illustrative earnings-per-share dilution of about 18%, reflecting the effect of issuing new shares to raise the MYR1.25 billion in gross proceeds.

Market sell-off after the announcement

The market’s response to the rights issue plan was sharply negative. On 12 October 2026, in the trading session following the announcement, Genting’s share price fell as much as 17.02% to RM1.56, described as its lowest level since April 2007.

The steep decline was accompanied by heavy intraday trading volume and resulted in the loss of more than MYR1 billion in market capitalisation during the session. The sell-off reflected investor concerns about dilution from the rights issue, the relatively limited immediate reduction in the group’s overall leverage and the prospect of continued refinancing needs.

Implications for Genting’s capital structure

The proposed rights issue marks a notable step in Genting’s efforts to manage its sizeable debt position, particularly its short-term obligations. By directing the majority of new funds to loan repayment, the group aims to lower interest costs and extend its financial flexibility, even if the overall reduction in gearing is incremental.

At the same time, the anticipated dilution and the scale of remaining borrowings underscore the ongoing balance-sheet challenges facing the group. Investor and analyst reactions suggest that the market will closely watch Genting’s subsequent financing decisions and operational performance following completion of the rights issue.