Nestcon to raise RM45.1m from IPO, prices new shares at 28 sen apiece

Nestcon Bhd group MD Datuk Dr Lim Jee Gin (centre) unveiling the prospectus with finance director Lim Joo Seng (third from left) and M&A Securities Sdn Bhd head of corporate finance Gary Ting (third from right), alongside other key senior management team members of Nestcon. (Photo taken before the full movement control order [FMCO])

Nestcon Bhd group MD Datuk Dr Lim Jee Gin (centre) unveiling the prospectus with finance director Lim Joo Seng (third from left) and M&A Securities Sdn Bhd head of corporate finance Gary Ting (third from right), alongside other key senior management team members of Nestcon. (Photo taken before the full movement control order [FMCO])

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KUALA LUMPUR (June 8): Nestcon Bhd, a building and infrastructure construction services provider, aims to raise RM45.1 million via its initial public offering (IPO) on Bursa Malaysia’s ACE Market.

In a statement today in conjunction with its prospectus launch, Nestcon group managing director Datuk Dr Lim Jee Gin said the group plans to utilise the proceeds raised via the IPO exercise to pave ways for stronger growth.

“Part of the proceeds will be allocated to set up an industrialised building system (IBS) facility, as well as to upgrade our software systems to reduce dependency on human labour and improve operational efficiency. 

“Correspondingly, we intend to acquire more equipment and machineries to strengthen our technical capabilities to take on larger projects as well as further expand and penetrate into other segments such as renewable energy,” he said.

The group will allocate RM16.5 million (36.6%) for repayment of bank borrowings, RM11 million (24.3%) for working capital, RM6.6 million (14.7%) for acquisition of machineries and equipment for business expansion in the civil engineering and infrastructure division, RM6 million (13.3%) for establishing an IBS facility for the building division and the remaining RM4 million (8.9%) to defray the estimated listing expenses.

Nestcon is issuing 161 million new shares, representing approximately 25% of the enlarged share capital, at an issue price of 28 sen per share. 

The group stated that 32.2 million new shares will be made available to the Malaysian public, 32.2 million new shares to eligible directors, employees and persons who have contributed to the success of the group, 80.5 million new shares to bumiputera investors by way of private placement approved by the Ministry of International Trade and Industry (MITI), and the remaining 16.1 million new shares to selected investors by way of private placement. 

Applications for the public issue are open from today to June 17, and Nestcon is slated to be listed on the ACE Market on June 29.

Based on the share capital of 643.8 million shares, Nestcon is expected to have a market capitalisation of RM180.27 million.

For the IPO exercise, M&A Securities Sdn Bhd is Nestcon’s adviser, sponsor, underwriter and placement agent, while Eco Asia Capital Advisory Sdn Bhd is the financial adviser.

Lam Jian Wyn