Hong Lai Huat (SGX:CTO) will issue and allot 40,503,000 shares to Ong Jia Jing, a company director, according to a filing with the Singapore Exchange on Monday.

The shares represent around 7.82% of the company's total issued and paid up capital.

Ong is acting in concert with Ong Bee Huat who is an executive director and has 43.3% voting rights in the company along with Lau Yen Eng who has 2.01% voting rights in the company, and Ong Jia Ming who has 3.98% voting rights.

Following the proposed placement, subject to shareholder approval, the concert parties will collectively have a 51.1% stake in the company which means that they are obligated to make a general offer for the company.

Ong received a whitewash waiver on Jan. 20, thus waiving the obligation to make a mandatory offer for the company.

Proceeds from the placement will be utilized for general working capital purposes.

Shares of the real estate development firm were down nearly 4% in recent trading.

Price (SGD): S$0.05, Change: S$-0.0020, Percent Change: -3.57%