KUALA LUMPUR (April 1): Sin-Kung Logistics Bhd said on Monday it had signed an underwriting agreement with M&A Securities Sdn Bhd for its upcoming initial public offering (IPO) on the ACE Market.
The agreement marks another step forward for the IPO since the company, which mainly provides trucking services focusing on airport-to-airport road feeder services, filed a draft prospectus in July 2023.
“The IPO is timely, as it will enable the company to gain access to the Malaysian capital market to raise funds to facilitate the continued growth and development of our trucking, container haulage, as well as warehousing and distribution services,” said Sin-Kung managing director Alan Ong.
Sin-Kung currently owns about 460 commercial vehicles for trucking, container haulage, warehousing and distribution, as well as other logistics-related businesses. The company also operates five warehouses in the central and northern regions of Peninsular Malaysia.
The company has earmarked proceeds from the IPO for expansion of warehousing and distribution services, repayment of bank borrowings, purchase of commercial vehicles, working capital, and to defray estimated listing expenses.
Meanwhile, proceeds from the offer for sale will go entirely to the selling shareholders, including Ong and his sister Angeline Ong Lay Shee, who is an executive director.
The IPO involves a public issue of 200 million new shares and an offer for sale of 103.5 million existing shares, according to the draft prospectus filed earlier. All in all, the IPO is offering up to a 25.3% stake in the company.
The public issue allocates 60 million shares to the public, and 45 million shares to eligible persons, with the remaining 95 million shares reserved for private placement to Bumiputera investors.
Under the agreement, M&A Securities will underwrite a total of 105 million new shares made available to the Malaysian public and eligible persons under the so-called pink form allocations.
The offer-for-sale tranche meanwhile sets aside 55.0 million shares for Bumiputera investors, and another 48.5 million shares for selected investors, both to be done through private placement.
M&A Securities is the adviser, sponsor, underwriter and placement agent for the IPO.