KUALA LUMPUR (Feb 16): Main Market-bound Cape EMS Bhd has announced its initial public offering (IPO) price of 90 sen and an enlarged issued share capital of 923 million upon listing during its prospectus launch on Thursday (Feb 16).
Cape EMS will have a market capitalisation of RM830.7 million upon listing.
The group also announced a dividend policy of up to 30% of profit after tax.
Cape EMS managing director and group chief executive officer Christina Tee Kim Chin said its strong financial performance has provided the resources to continue investing into manufacturing facilities to capture more market share by taking more orders for new products from existing and new customers.
She also stated that the market size for the manufacturing of electronic equipment in Malaysia stood at RM123.4 billion in 2021, and “our current market share is less than 1% which represents a huge room for growth”.
“Our existing customers are committed [to] growth and our new customers as well.
“We are using the proceeds [from the IPO] to actually build a warehouse to host all our incoming materials and our finished goods before we [deliver them],” she said in a press conference.
Cape EMS, through its subsidiaries, is involved in aluminium die cast manufacturing, electronics manufacturing services (EMS) and supply of electronic products and related activities.
The public issue totalled 173 million shares, which will raise RM155.7 million, while its retail offering was 54.2 million shares.
From its retail offering, 46.2 million shares (RM41.58 million) will be set aside for the Malaysian public, while eight million shares (RM7.2 million) will be allocated to eligible directors, employees, customers and suppliers who have contributed to the success of the group.
The institutional offering comprises 205.5 million shares (representing 22.3% of the enlarged issued share capital upon listing), and 28.8 million shares will be allocated to Bumiputra investors approved by the Ministry of International Trade and Industry, while 90 million shares will be set aside for other institutional and selected investors.
From the proceeds, RM62.8 million, or 40.3%, was allocated for setting up a new cleanroom facility and purchase of new automated production lines for EMS operations.
Meanwhile, RM53.1 million (34.1%) is reserved for the construction of a new Senai 226 warehouse and the installation of automated storage facilities.
Another RM20.5 million (13.2%) will be used for working capital, RM11 million (7%) for estimated listing expenses, RM4.6 million (3%) for the purchase of machinery and equipment for die-cast manufacturing related services, and RM3.7 million (2.4%) for the installation of energy saving cooling systems.
The group is expected to be listed on the Main Market on Bursa Malaysia on March 10 this year. Its closing retail offering will be on Feb 24.
Hong Leong Investment Bank is the principal adviser, joint bookrunner and joint underwriter.
AmInvestment Bank is the joint bookrunner and joint underwriter in connection with the IPO.
