KUALA LUMPUR (March 30): Edelteq Holdings Bhd has inked an underwriting agreement with UOB Kay Hian Securities (M) Sdn Bhd (UOBKH) in conjunction with its May initial public offering (IPO) on the ACE Market of Bursa Malaysia.

In a statement, Edelteq said the IPO comprises a public issue of 100 million new shares (representing 18.78% of the group’s enlarged share capital) and an offer for sale of 43.2 million shares (or 8.11% of the enlarged share capital) through private placement to selected investors.

Of the 100 million under the public issue, 26.63 million will be made available to the Malaysian public, followed by 10 million shares to the group’s eligible employees and those who have contributed to its success (pink form allocations), while the remaining 63.37 million shares are to be placed out to selected investors.

UOBKH will underwrite a total of 36.63 million new shares made available to the Malaysian public and pink form allocations.

Edelteq is principally engaged in the provision of engineering support for integrated circuit (IC) assembly and test processes within the semiconductor industry. It is also involved in the trading of operating supplies, spare parts and tools for IC assembly and testing.

Edelteq’s customers are primarily multinational integrated device manufacturers and outsourced semiconductor assembly and test companies in Malaysia and overseas, including countries such as Singapore, Thailand, China and the US.

Edelteq executive director and group chief executive officer Chin Yong Keong said the group plans to allocate the majority of its IPO proceeds towards scaling up production capacity to meet growing demand for its services, and to introduce new products.

“This expansion will necessitate a larger production space for new machinery and additional office space for future human resources increases.

“We will also direct resources towards research and development efforts for the development of new automated test equipment and refurbishment methods, as well as enhancing our factory automation solutions," Chin added.

Besides being the underwriter of the listing exercise, UOBKH is also the principal adviser, sponsor and placement agent for the IPO.