KUALA LUMPUR (March 20): Johor-based vegetable wholesaler Farm Price Holdings Bhd said on Wednesday it has secured regulatory approval for its listing on the ACE Market of Bursa Malaysia.

The approval marks another step forward for Farm Price’s initial public offering since the company filed a draft prospectus on Oct 12, 2023.

“We believe it is timely as the public is given the opportunity to invest in a business that plays a crucial role in ensuring sufficiency of fresh vegetables in the market,” Farm Price managing director Dr Tiong Lee Chian said in a statement.

Farm Price is mainly involved in the wholesale and distribution of fresh vegetables. The company also operates a retail store in Ulu Tiram, Johor selling fresh vegetables together with food and beverages products and other groceries directly to end-consumers.

The company has regional distribution centres across northern, central as well as southern regions of peninsular Malaysia, alongside a centralised distribution centre in Johor serving both Malaysia and Singapore markets.

The IPO entails a public issue of 102 million new ordinary shares as well as an offer for sale of 33 million existing shares. All in, the listing offers investors a 30% stake in the company.

Under the public issue, 22.5 million new shares will be made available to the Malaysian public, followed by 11.25 million shares for eligible persons and 68.25 million shares set aside for private placement to select investors.

The offer-for-sale meanwhile involves a private placement of shares held by existing shareholders, Tiong and executive director Liew Tsuey Er, who is also Tiong’s wife.

Proceeds from the IPO will be used for the construction of new facilities, purchase of machinery, equipment and logistics fleet, planned regional distribution and procurement centre and working capital, according to the draft prospectus.

On the financial front, Farm Price’s earnings have risen over the past three financial years with profit after tax of RM4.75 million in the financial year of 2022 (FY2022) versus RM3.11 million in FY2021 and RM2.86 million FY2020.

Revenue meanwhile has grown to RM94.38 million in FY2022 from RM81.97 million in FY2021 and RM73.54 million in FY2020.

Alliance Islamic Bank Bhd is the principal adviser, sponsor, sole underwriter and placement agent.