SerSol eyes bigger share in decorative painting business

KUALA LUMPUR: Paints and coatings company SerSol Bhd is aiming for a five per cent to eight per cent market share in the decorative painting business in the next three to five years.

Executive director Bernard Tan Fie Jen said the company has just diversified into the decorative painting business this year and is planning to move into the business of protective coating for the oil and gas industry next year.

"We want to move forward in establishing our consumer paint business while maintaining our segment for the electrical and electronic industry. These two segments are the lucrative markets for the painting industry.

"We are allocating about RM900,000 for research and development (R&D) for two years," he said after the company's extraordinary general meeting (EGM) here on Saturday.

Meanwhile, at the EGM, shareholders approved a proposal on a rights issue involving an issuance of up to 96.35 million new ordinary shares together with up to 96.35 million free detachable new warrants at an indicative issue price of 10 sen for each rights share.

Tan said the passing of the proposal reflected the continuing support from shareholders and that it will reinforce the company's perseverance to continue expanding its business with a planned restructuring exercise to transform from a loss-making organisation into a profitable entity.

The company expects to raise gross proceeds of up to RM9.6 million from the rights exercise, expected to be completed by the second quarter of this year.

Tan said RM5.2 million will be used for working capital and RM2.5 million for the repayment of bank borrowings as part of SerSol's turnaround strategy to reduce its debts and venture into more lucrative industries.

Its other plans include purchasing additional production plant for the production of architectural paints and coatings. Bernama