KUALA LUMPUR (April 17): Synergy House Bhd has inked an underwriting agreement with Kenanga Investment Bank Bhd (Kenanga IB) for the group’s upcoming initial public offering (IPO) on the ACE Market of Bursa Malaysia Securities Bhd.
In a statement on Monday (April 17), the cross-border e-commerce seller and furniture exporter of ready-to-assemble (RTA) home furniture said it had earlier obtained the approval of Bursa for the listing of its shares on the ACE Market.
In conjunction with its listing, Synergy House’s IPO exercise will comprise a total of 130.0 million shares, including a public issue of 80.0 million new shares representing 16.0% of the enlarged issued share capital.
The IPO shares from the public issue will be allocated in the following manner:
- 25.0 million shares representing 5.0% of the enlarged issued share capital to be allocated via balloting to the Malaysian public;
- 12.5 million shares representing 2.5% of the enlarged issued share capital to be allocated to eligible directors, employees and persons who have contributed to the group (eligible persons);
- 30.0 million shares representing 6.0% of the enlarged issued shares to be allocated to selected investors by way of private placement; and
- 12.5 million shares representing 2.5% of the enlarged issued shares capital to be allocated to Bumiputera investors approved by the Ministry of International Trade and Industry (Miti).
The IPO exercise also includes an offer for sale of 50.0 million existing shares representing 10.0% of the enlarged issued share capital, which will be made available by way of private placement to Bumiputera investors approved by Miti.
Synergy House executive director Tan Eu Tah said the IPO will provide the company the capital to grow its business.
“Since 2004, we have focused solely on the design, development and sales of RTA home furniture, and outsourced all manufacturing work to third-party manufacturers,” he said.
Meanwhile, Teh Yee Luen, another executive director, said funds raised via the IPO will enable the company to continue to grow its business-to-consumer (B2C) segment, which it started in 2012.
“Sales from our B2C segment increased from RM1.99 million in the financial year ended Dec 31, 2019 (FY2019) to RM24.78 million in FY2021, at a compound annual growth rate of 252.88%.
“In tandem with our strategy to continue growing our B2C segment, part of our IPO proceeds will be used to purchase inventories for our B2C segment as well as for the implementation of e-commerce advertising and promotion strategies,” he said.