This article first appeared in The Edge Financial Daily on July 21, 2017

KUALA LUMPUR: Penang-based property developer Aspen Holdings Ltd has launched its initial public offering (IPO) in conjunction with its upcoming listing on the Catalist board of the Singapore Exchange.

The company is offering a total of 173.27 million shares, priced at 23 Singapore cents each. Of this, 4.35 million shares are to be made available to the public, with the remaining 168.92 million as placement shares.

Aspen’s offer document showed that the IPO is expected to generate net proceeds of S$36.72 million (RM114.92 million), which the company plans to use for future land banking activities, repaying bank borrowings and as working capital.

Explaining Aspen’s decision to list in Singapore, chief executive officer Datuk Murly Manokharan said the group wants to be a regional player.

“We are coming in as a Penang-centric real estate developer, but we want to be a regional player,” he was quoted as saying by Singapore’s Straits Times newspaper. “We feel Singapore attracts more international investors and so it [suits] us well at the moment.”

Previously, Murly had said that Aspen also plans to list its shares in Malaysia.

Aspen’s developments at the moment are concentrated in Penang. The firm is in partnership with Swedish furniture giant Ikano Pte Ltd, with whom it is developing the 245-acre (99ha) Aspen Vision City in Batu Kawan, Penang.

The mixed development, which will completed in phases over the next 10 years, comprises residential properties, a shopping centre and the first Ikea outlet in northern Peninsular Malaysia.

Post-listing, Manokharan said he is optimistic that investors will look beyond the company’s past losses and focus more on its growth prospects.

For the financial year ended Dec 31, 2016 (FY16), Aspen recorded a net loss of RM306,000 compared to a net profit of RM4.69 million in FY15, although revenue improved to RM99.65 million from RM52.51 million, its document showed.

Aspen said its growth will be driven by Malaysia’s growing population, a strong inflow of investments into Penang, as well as recent government policies promoting affordable home ownership, including 100% stamp duty exemption for first-time homebuyers purchasing homes valued up to RM300,000 for 2017 and 2018. 

Aspen’s IPO closes on July 26.