Friday 29 Mar 2024
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KUALA LUMPUR (Nov 13): 7-Eleven Malaysia Holdings Bhd, the country's largest convenience store chain controlled by tycoon Tan Sri Vincent Tan, has scrapped plans to use RM40.79 million from its initial public offering (IPO) to build a combined distribution centre (CDC). Instead, the money will now be allocated for working capital.

In a filing with Bursa Malaysia today, 7-Eleven Malaysia said the RM40.79 million was part of a proposed utilisation for total capital expenditure (capex) of RM184.79 million as contained in its IPO prospectus.

The amount of RM40.79 million, which was allocated for the construction of the CDC, remained unutilised as at Aug 28.

"The board of directors of the group wishes to announce that they have approved for the unutilised balance of RM40.79 million to be re-allocated for working capital which will further support the continued growth of our business," said 7-Eleven Malaysia.

The remaining unutilised balance for capex amounting to RM65.81 million will continue to be used for its intended purpose, it added.

The group said the change in utilisation was after taking into consideration the available capacity of its existing leased warehouse facilities in Shah Alam, Selangor and the abundant availability of other warehousing facilities in the market.

"Our group will lease additional warehouse facilities as and when required to cater for our store expansion plan, which is still on track.

"Our group will continue to explore various options for its existing land which we have invested approximately RM12 million including land cost of RM10.8 million to-date," said 7-Eleven Malaysia.

7-Eleven Malaysia's IPO last year had raised a total of RM250.31 million from the public issue.

Its share price closed up one sen or 0.71% to RM1.42 today, bringing a market capitalisation of RM1.72 billion.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

 

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