KUALA LUMPUR (Sept 30): Solarvest Holdings Bhd, an associate company of locally-listed Chin Hin Group Bhd that is slated to debut on the Ace Market of Bursa Malaysia on Nov 26, is planning to raise RM34.59 million from its initial public offering.
The solar photovoltaic (PV) system specialist's IPO entails the issuance of 98.83 million new shares — representing 25.3% of its enlarged share capital — at the issue price of 35 sen a share, according to the group's listing prospectus filed to Bursa Malaysia.
The bulk or RM19.2 million of the proceeds raised, will be used to fund its daily operations, including additional working capital requirements for future projects, while RM4 million will be allocated for the acquisition of project machinery, equipment and the upgrading of IT software and hardware, to help support its plans to tender and complete more projects in Malaysia.
Of the remainder, RM5 million will be used to repay bank borrowings and RM3 million to expand its business into the southern region of Peninsular Malaysia, as well as into Taiwan and Vietnam, where it will bid for and undertake more solar PV projects. The balance RM3.4 million will be used to defray listing expenses.
Of its public issuance of 98.83 million new shares, 19.53 million will be made available for application by Malaysian public, together with another 19.53 million for eligible directors and employees, while 20.70 million will be placed out to selected investors. Another 39.06 million will be placed with identified Bumiputera investors.
In an exclusive interview with The Edge weekly recently, Solarvest managing director Lim Chin Siu expressed confidence of prospects for the solar industry, as the cost of generating renewable energy is now almost on par with conventional energy generation.
“Solar companies in Malaysia are in a sweet spot. The business environment is favourable to us because the prices of solar equipment, panels and inverters have dropped substantially since 2012.”
At 4pm, Chin Hin shares were unchanged at 78 sen apiece, bringing it a market capitalisation of RM431.80 million.