Mr DIY's IPO draws AIA, BlackRock as cornerstone investors

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SINGAPORE (Oct 1): Mr DIY Group is in talks with Aberdeen Standard Investments and BlackRock Inc to become cornerstone investors in its initial public offering (IPO), which could be Malaysia's biggest in more than three years, said people with knowledge of the matter.

AIA Group Ltd is also in discussions to take a stake in the first-time share sale by Malaysia's biggest home-improvement retailer, according to the people, who asked not to be identified as the information is private.

The company is planning to file an official prospectus as soon as next week and has set the IPO price at RM1.60 each, the people said. The offering could raise about RM1.5 billion based on the number of shares in its draft prospectus.

The home-improvement retailer plans to formally confirm the cornerstone investors as soon as the end of the week, the people said. Negotiations are ongoing and the investor line-up could change, the people said.

Representatives for Aberdeen Standard, AIA Group, BlackRock, and Mr DIY declined to comment.

The return of Mr DIY's IPO comes as its sales surged to a record in May, June, and July after the Malaysian government partially lifted coronavirus-driven restrictions in order to resuscitate the economy, the people said.

At US$362 million, Mr DIY's share sale would be the biggest IPO in Malaysia since Lotte Chemical Titan Holding Bhd raised US$849 million in 2017, data compiled by Bloomberg show. The potential deal would give a boost to the nation's equity capital market, which has only seen US$96.5 million worth of IPOs so far this year, putting it on track for the slowest year in more than a decade.

Mr DIY, backed by private equity firm Creador, opened its first store in Malaysia in 2005 and now operates more than 622 outlets across the country, according to its website. The company sells over 16,600 types of products in 10 categories including furnishings, computer and mobile accessories, hardware, and toys. It counts Tesco plc and AEON Co among its business partners.