Malaysia: Advancecon
Holdings Bhd, which is en route to a listing on the Main Market of Bursa
Malaysia on July 10, is raising gross proceeds of RM56.7mil from its initial
public offering (IPO) price of 63 sen per share.
According to its
prospectus, the earthworks and civil engineering services specialist, is
issuing 90 million new shares or 22.4% of its enlarged issued share capital and
paid-up share capital.
There will also be
an offer for sale of existing shares, where 33 million shares will be allocated
for private placement to identified bumiputra investors approved by the
International Trade and Industry Ministry.
Advancecon has
allocated RM29.7mil, or 52.4% of its IPO proceeds as capital expenditure. It
has also earmarked RM12.5mil, or 22% for repayment of bank borrowings while
RM10.7mil, or 18.9% for working capital.
The remaining
RM3.8mil, or 6.7% will go towards estimated listing expenses.
The company is
expected to have RM253.3mil in market capitalisation based on the IPO price
upon listing.
For the financial
year ended Dec 31, 2016 (FY16), Advancecon posted a net profit of RM26.4mil
compared with RM29.9mil in FY15.
Its revenue for the
period rose stood at RM234.6mil against RM264.3mil in the previous year.
Group CEO Datuk Phum
Ang Kia said: "Our contract wins for the provision of earthworks and civil
engineering services for the West Coast Expressway and Pan Borneo Highway
solidifies our position as one of the industry players that is able to undertake
such large scale projects."
He said that the
company is optimistic of its prospects and the raising of funds through the IPO
would help prepare its balance sheet for even bigger scale projects.
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