This article first appeared in The Edge Financial Daily on June 29, 2018

KUALA LUMPUR: Retail technology solutions provider Radiant Globaltech Bhd, which is slated to be listed on Bursa Malaysia’s ACE Market on July 24, is seeking to raise RM29.5 million from its initial public offering (IPO).

Radiant’s public share sale entails the issue of 128.1 million new shares representing 24.4% of the group’s enlarged issued share capital, at an issue price of 23 sen per share.

Of the 128.1 million new shares, 11 million shares will be for application by the Malaysian public, 21.1 million shares for eligible directors, employees and people who have contributed to the success of the group, and 96 million shares for private placement to selected investors.

In addition, 12 million existing shares will be available for sale to selected investors in private placement.

At the prospectus launch yesterday, managing director Paul Yap Ban Foo said about RM11.6 million of the IPO proceeds will be used to support business and capital expansion. Radiant has captured about 20% share or an estimated RM404 million of Malaysia’s retail technology solutions industry.

The group will continue its expansion into Indonesia in the near term as it already has existing customers there. “We plan to distribute our retail hardware products and implement our retail management software services to retailers in Indonesia,” said Yap.

The group posted a net profit of RM189,000 in its first quarter ended March 31, 2018, on a revenue of RM13.81 million. Some 91% of the group’s revenue came from its hardware and maintenance segment, with the balance derived from its software segment.

Asked if they are concerned about launching their IPO in soft market conditions, Alliance Investment Bank Bhd head of corporate finance, capital markets, Tee Kok Wah said the bank’s research shows there is interest for these kinds of stocks.

“There is a positive interest. As such we have managed to get the necessary subscriptions for the placement block, so on this basis we will proceed,” Tee said.