KUALA LUMPUR (Dec 29): Senheng New Retail Bhd plans to raise RM267.5 million in new proceeds from its initial public offering (IPO) on the Main Market of Bursa Malaysia to fund its next transformation phase and shape the nation’s new retail landscape.
The consumer electrical and electronics retailer said the IPO exercise entails the public issue of 250 million new shares and an offer for sale of 139.5 million existing shares at an issue price of RM1.07 per share.
Of the proceeds to be raised from the public issue, Senheng said the majority 60% or RM160.5 million will go towards setting up new stores as well as upgrading existing stores into bigger, enhanced concept stores. The group aims to upgrade or set up 61 new and existing stores from 2022 to 2024 to elevate the shopping experience of its customers.
Another 19.3% or RM51.7 million will be used to strengthen the group’s back-end capacities and capabilities. This includes developing the new brand distribution business, expanding and upgrading the warehouse and logistics network, and boosting the group’s digital infrastructure.
The remaining 20.7% or RM55.3 million, Senheng said, will be utilised to repay bank borrowings and defray listing expenses.
Speaking at its virtual IPO prospectus launch on Wednesday (Dec 29), Senheng executive chairman Lim Kim Heng said the company is at the forefront of shaping the new retail landscape to meet latest consumer trends.
Based on the issue price of RM1.07 per share, Senheng will achieve a market capitalisation of RM1.6 billion upon listing on the Main Market on Jan 25, 2022. Applications for Senheng’s IPO are open from Wednesday and will close on Jan 10, 2022.
Of the 250 million new shares, 149.5 million shares will be placed out to institutional and selected investors, while 48 million shares will be placed out to bumiputera investors approved by the Ministry of International Trade and Industry (MITI).
Another 22.5 million shares will be made available for application by eligible directors, employees and persons who have contributed to the group’s success.
The remaining 30 million new shares will be made available for application by the Malaysian public via balloting.
Meanwhile, 139.5 million offer-for-sale shares will be placed out to bumiputera investors approved by MITI.
Mercury Securities Sdn Bhd is the principal adviser, managing underwriter and joint bookrunner for the IPO exercise, while CIMB Investment Bank Bhd and AmInvestment Bank Bhd are the joint bookrunners and joint underwriters.