This article first appeared in The Edge Financial Daily, on March 16, 2016.

KUALA LUMPUR: HLT Global Bhd, a glove-dipping lines designer and fabricator, and Perak Transit Bhd, which is a public transportation services provider, are both eyeing to float their companies on the ACE Market of Bursa Malaysia.

HLT plans to raise funds from its initial public offering (IPO) to fund its capital expenditure, including the acquisition of a land parcel to set up a new factory in the south of the Klang Valley like Puchong, Banting or Klang, its working capital and to set up a dedicated research and development facility to focus on product development and process improvement.

The group is looking for one with a built-up area of about 57,000 sq ft, of which some 60% or 34,200 sq ft will be earmarked for production. It has yet to identify a suitable parcel of land for the purpose.

Currently, it operates from its own factory in Puchong, which has a gross production floor space of 23,666 sq ft.

It estimates the total cost for the land buy and factory construction to be between RM9 million and RM12 million, based on an estimated land size of two acres (0.81ha). Any additional funding needed to fund the expansion will be met through internally generated funds and/or external borrowings.

Its IPO involves the issuance of 39.59 million new shares, of which 13.19 million shares will be offered to the public and 26.39 million will be privately placed to identified bumiputera investors. It is also offering 34.31 million ordinary shares in the company for sale, of which two million will be for application by eligible directors and employees, and 32.31 million will be offered to selected investors.

The promoters of the IPO are its chief executive officer Chan Yoke Chun and deputy chairman Wong Kok Wah. Both are substantial shareholders of HLT Global with 51% and 49% stakes, respectively.

Meanwhile, Perak Transit, the operator of the integrated terminal complex (ITC) known as Terminal Amanjaya in Ipoh, Perak, which was completed in 2012, intends for its IPO to raise cash for its future business expansion, repayment of hire purchase facilities and working capital.

According to its draft prospectus, Perak Transit will use part of its IPO proceeds to partly finance the construction of another ITC in Kampar, Perak.

It expects the approximate cost of the construction of the ITC to be RM128.33 million, and that construction can start by early 2016, to be completed in 18 months.

The remaining cost and additional funds to put the ITC’s operations on stream will be financed via a combination of internally generated funds and bank borrowings, it added.

It estimates to procure financing facilities of about RM90 million to finance the construction of the ITC.

The group also plans to allocate part of the IPO proceeds for the repayment of hire purchase facilities from several financial institutions, the sum of which it did not specify, which were used to finance the purchase of stage buses.

The remainder will be for working capital, including the employment of 35 new staff for its terminal operations, and 45 new bus drivers — and the defraying of the listing expenses.

Its IPO involves the issuance of 245 million ordinary shares, of which 58 million shares will be offered to the public, while 187 million will be placed to selected investors.

It is also offering 56 million existing shares for sale to selected investors.

Its promoters and substantial shareholders are managing director Datuk Seri Cheong Kong Fitt, executive director Datuk Cheong Peak Sooi, Datin Seri Lim Sow Keng, CBS Link Sdn Bhd, Muamalat Venture Sdn Bhd, MTD Capital Bhd, Senandung Asas Sdn Bhd and Gemas Perunding Sdn Bhd.