KUALA LUMPUR (Feb 14): Projek Lintasan Kota Holdings Sdn Bhd (Prolintas) is set to be listed by the first quarter of 2024 (1Q2024), as it saw the signing of an underwriting agreement on Wednesday with four banks as joint underwriters for an initial public offering (IPO) exercise on the Main Market of Bursa Malaysia.
The signed joint underwriters are AmInvestment Bank Bhd, CIMB Investment Bank Bhd, Maybank Investment Bank Bhd and RHB Investment Bank Bhd.
Besides acting as a joint underwriter, AmInvestment Bank is also the IPO's principal adviser, lead bookrunner, joint bookrunner, and managing underwriter. CIMB Investment Bank and Maybank Investment Bank are also joint bookrunners.
In a statement on Wednesday, Prolintas said the IPO exercise will be done via a business trust structure whereby Prolintas Infra Business Trust (Prolintas Infra BT) will be the entity that will be listed, making it Malaysia's first highway business trust to be listed.
The business trust structure comprises four highways that have been acquired from Prolintas by the trustee-manager Prolintas Managers Sdn Bhd, on behalf of Prolintas Infra BT.
They are the Ampang-Kuala Lumpur Elevated Highway (AKLEH), Guthrie Corridor Expressway (GCE), Lebuhraya Kemuning-Shah Alam (LKSA), and Sistem Lingkaran Lebuhraya Kajang (SILK).
Prolintas also owns the Sungai Besi-Ulu Kelang Elevated Expressway (SUKE) and the Damansara-Shah Alam Elevated Expressway (DASH) — both launched in the second half of 2022 — which are not included in the exercise.
The Edge Malaysia weekly reported in November 2023 that Prolintas was estimated to raise up to RM1.5 billion from the IPO exercise, which would value the listed highway trust at an estimated RM3.5 billion, citing sources. Prolintas is a unit of Permodalan Nasional Bhd.
It is slated to be one of the largest IPOs in the country in two years, beating those of Khazanah Nasional Bhd-backed Farm Fresh Bhd (RM2.5 billion valuation in March 2022) and Creador-backed CTOS Digital Bhd (RM2.4 billion valuation in June 2021).
In its statement, Prolintas said the IPO will involve an offer for sale of 539 million existing units in Prolintas Infra BT, representing 49% of the total units in issue, assuming the over-allotment option of 70.3 million units is fully exercised.
Prolintas said the joint underwriters have agreed to underwrite the retail offering of 45.75 million IPO units in Prolintas Infra BT, representing 4.16% of the total units in issue.
Of the retail offering IPO units, 18.25 million units will be allocated to the directors and key senior management of the trustee-manager, eligible employees of the trustee-manager and the companies held under Prolintas Infra BT.
Another 27.5 million units will be reserved for application by the Malaysian public via balloting.
Prolintas group chief executive officer Datuk Mohammad Azlan Abdullah said the listing exercise will provide an avenue for the company to unlock the value of its assets.
At the same time, the business trust listing structure, according to Mohammad Azlan, enables the company to provide its unitholders sustainable returns in the long run as the assets have the requisite earnings visibility given their concession-based nature.
For the financial year ended Dec 31, 2022 (FY2022), Prolintas suffered after-tax losses of RM172.68 million compared with a profit after tax of RM142.61 million a year earlier. Revenue, however, surged 15.5% to RM369.99 million in FY2022 from RM342.67 million in FY2021.
As at end-FY2022, the company had total assets of RM17.33 billion — 13.3% higher than RM15.29 billion in 2021. Its total liabilities stood at RM14.32 billion at end-2022, an increase from RM12.51 billion the year before.
Besides Prolintas, existing listed concessionaires on Bursa Malaysia include IJM Corp Bhd, which owns the Sungai Besi Expressway (Besraya), New Pantai Expressway (NPE) and Kajang-Seremban Expressway (Lekas); Ekovest Bhd, which operates the Duta-Ulu Kelang Expressway (DUKE); WCE Holdings Bhd, the concession owner of the 233km interstate West Coast Expressway, which has opened to the public with parts of the highway under construction; and Ahmad Zaki Resources Bhd, which owns the East Klang Valley Expressway (EKVE) — also currently under construction.