This article first appeared in The Edge Financial Daily on January 29, 2019

KUALA LUMPUR: AME Elite Consortium Bhd, an industrial property developer and services provider, is seeking a listing on the Main Market of Bursa Malaysia to raise funds for expansion.

In its draft prospectus filed with the Securities Commission Malaysia, AME Elite’s initial public offering (IPO) entails the issuance of up to 128.13 million shares, representing up to 30% of its enlarged issued share capital, comprising an offer for sale of up to 42.71 million shares and a public issue of 85.42 million new shares.

There will be an institutional offering of up to 111.05 million IPO shares or 26% of its enlarged issued share capital, and retail offering involves the offering of 17.08 million IPO shares or 4% of the enlarged issued share capital.

The company’s promoters and selling shareholders are Lee Chai, Lim Yook Kim and Kang Ah Chee who hold a 29.8% stake each, Lee Sai Boon (10.5%) and Lim Pei Shi (0.1%). Their stakes will be reduced to 21%, 7% and less than 0.1% after the IPO.

AME Elite said of the total proceeds from the IPO, 62.2% will be used for future industrial property development and investment projects including land acquisitions and joint ventures and 20.7% for working capital for its i-Park @ SAC industrial park development.

“As at Nov 1, 2018, we are in preliminary discussions with certain land owners in and outside Johor on potential acquisition and development opportunities. However, we have not identified or committed to any acquisition and development targets,” it added.

The remaining 8.1% of the total proceeds will be used to partially fund the expansion of its precast concrete fabrication capacity by establishing the new facility next to its existing facility in Johor.

“Upon the completion of the new facility, we expect to have two new precast concrete production lines measuring 63,000 sq ft each that will increase our total precast concrete fabrication capacity by 12,000 cu m of precast concrete per year,” said the company.

CIMB Investment Bank Bhd is the principal adviser and underwriter for the retail offering and placement agent for the institutional offering in relation to AME Elite’s IPO.