KUALA LUMPUR (April 3): Property developer Radium Development Bhd has inked an underwriting agreement with Malacca Securities Sdn Bhd and CIMB Investment Bank Bhd in conjunction with its upcoming initial public offering (IPO) on the Main Market of Bursa Malaysia Securities Bhd.
The IPO exercise involves a public issuance of 868 million new shares, representing 25% of its enlarged share capital.
Radium’s IPO is distinctive in that there is no offer-for-sale component, with all IPO proceeds to be channelled to the group.
The IPO proceeds will substantially be utilised for the acquisition of land bank and development expenditure, as well as hotel construction, demonstrating Radium’s commitment to accelerating its business growth.
Out of the 868 million new shares to be issued, 273 million shares will be made available to the Malaysian public via balloting, followed by 60 million shares to its eligible key senior management, employees of the group and business associates, including any other persons who have contributed to the success of the group.
A further 435 million shares will be offered by way of private placement to selected Bumiputera investors approved by the Ministry of International Trade and Industry, and the remaining 100 million shares for selected investors by way of private placement.
Malacca Securities is the principal adviser, managing underwriter and a joint placement agent for the IPO, while CIMB Investment Bank is a joint underwriter and joint placement agent.
Radium is slated to be listed on the Main Market in the second quarter of 2023.
Its group managing director Datuk Gary Gan Kah Siong said the company had built a reputation for delivering affordable homes for the working class in Kuala Lumpur.
“This has resonated with our target market, as Radium has no units available for sale across all launches pre-2020, and are looking to continue our trajectory with RM1.5 billion worth of new launches in 2023.
“We believe that the IPO will accelerate our expansion plans by allowing us to tap into the equity capital market to capitalise on future growth opportunities,” he said.
Meanwhile, Malacca Securities managing director Lim Chia Wei said Radium’s resolve to achieve long-term growth is clearly demonstrated via the IPO, which is carried out without an offer-for-sale, and that all monies raised would be channelled towards the company’s future growth.
Gan said Radium intends to tap into the growing population in Kuala Lumpur, considering the improvement in the urban transportation network, government-led home ownership initiatives, and immense attraction for job opportunities.
He said it is estimated that there is underlying demand for more than 300,000 homes in Kuala Lumpur, as compared to regional city centres such as Taipei, Shanghai, and Singapore.
Hence, Gan said Radium had earmarked approximately RM1.5 billion worth of new launches in 2023, of which it had unveiled the RM521.0 million R Suite Chancery Residences in early 2023, featuring residences coupled with a four-star hotel.
He said the prime location on Jalan Ampang — being 5km from the city centre and between Gleneagles Hospital Kuala Lumpur and KPJ Ampang Puteri Specialist Hospital — positions it aptly for the medical tourism sector.