KUALA LUMPUR (May 25): Ekuiti Nasional Bhd (Ekuinas) has started discussions to crystallise its investments in sportswear retail group Al-Ikhsan Sports, said Ekuinas chief executive officer Syed Yasir Arafat Syed Abdul Kadir.
“We are open [to list Al-Ikhsan], in fact we are having discussions on whether to exit this year or not,” Syed Yasir Arafat said at a press conference after the fund’s 2022 results announcement.
Ekuinas is open to exit the investment via initial public offering (IPO), or trade sale, depending on the valuation that Ekuinas gets, the CEO added.
Ekuinas bought 35% in Al-Ikhsan Sports in 2016 for RM68.6 million. Al-Ikhsan Sports now operates 181 outlets.
In 2022, Al-Ikhsan Sports' revenue grew 72.4% year-on-year to RM485.4 million from RM281.6 million, while earnings before interest, tax, depreciation and amortisation (Ebitda) before extraordinary items more than tripled to RM70.3 million, from RM18.7 million. The strong rebound in retail sales in 2022 lifted the group’s performance to support the turnaround of Ekuinas’ Tranche III Direct Fund last year.
Al-Ikhsan recorded sales of RM330 million in 2019, and the strong rebound in retail sales in 2022 lifted the group’s performance to support the turnaround of Ekuinas’ Tranche III Direct Fund last year.
Ekuinas also “continues to explore opportunities with Orkim Sdn Bhd”, said Syed Yasir Arafat, when asked if the fund is looking to exit the shipping firm.
The fund, which owns a 95.5% stake in Orkim, is potentially looking at selling the shipping company and is seeking as much as RM1.5 billion, Bloomberg reported, citing sources.
Orkim’s stake was acquired by Ekuinas in 2014 for almost RM346.3 million.
In 2022, Orkim’s revenue rose 23.5% to RM227.9 million from RM184.5 million, while Ebitda before extraordinary items rose 53.7% to RM135.6 million, from RM88.2 million. The company’s “standout performance” in 2022 contributed to the growth in Ekuinas’ Tranche II Direct Fund, which posted a gross internal rate of return of 11.9% per annum this year.