KUALA LUMPUR (Jan 27): Underground utilities and substation engineering specialist MN Holdings Bhd (MNHB) has inked an underwriting agreement with M&A Securities Sdn Bhd in conjunction with its initial public offering (IPO) exercise to list on the ACE Market of Bursa Malaysia Securities Bhd (Bursa Securities).

In a statement Thursday (Jan 27), MNHB said the IPO entails a public issue of 81.8 million new shares in MNHB, representing 20% of the enlarged share capital and an offer for sale of 40.9 million existing shares to selected investors by way of private placement.

It said of the 81.8 million new shares, 20.4 million new shares will be made available to the Malaysian public via balloting, 8.2 million new shares for its eligible directors and employees under pink form allocations, while 51.1 million new shares are reserved for private placement to approved Bumiputera investors.

M&A Securities will underwrite a total of 28.6 million new shares made available for the Malaysian public and pink form allocations. 

MNHB mainly serves customers in the power, gas, sewerage and telecommunications industries in Malaysia.

Its customers are primarily main contractors for utility projects, property developers and industries that require its services to enable the supply of power to specific locations and/or premises. 

MNHB managing director Loy Siong Hay said the signing of the agreement takes the company a step closer towards listing on Bursa Malaysia Securities.

“The listing will enable us to tap into the equity capital market to raise funds to support our business expansion for the underground utilities and substation engineering services and solution segments,” he said.

According to him, the group’s operational resources to carry out underground utilities engineering and substation engineering works for its customers depend largely on the availability of its machinery and equipment.

Thus, proceeds from the IPO would generally be used to purchase various machinery and equipment to cater for underground utilities and substation engineering projects of different scale and complexities, he said.

In addition, he believes that the acquisition of these machinery and equipment will allow the group to scale up its resources and project capabilities in undertaking more projects.

Part of the proceeds will also be used for repayment of bank borrowings, general working capital and to defray the estimated listing expenses, according to him.

MNHB is scheduled to be listed on the ACE Market of Bursa Securities by April 2022.