KUALA LUMPUR (May 31): Tex Cycle Technology (M) Bhd (KL:TEXCYCL) is looking to raise up to RM32.02 million via a private placement for the construction of an integrated scheduled waste management facility in Sabah.

In a bourse filing, the scheduled waste disposal specialist said the private placement entails the issuance of up to 25.62 million new shares or 10% of its share base to third-party investors to be identified later.  

The issue price of the placement shares will also be determined at a later date but the estimated gross proceeds of RM32.02 million is based on an indicative issue price of RM1.25 per share, said Tex Cycle.

Subject to approval from Bursa Securities and other relevant authorities, the private placement is expected to be completed in the second half of 2024.

Last month, Tex Cycle said it has partnered with Evolusi Bersatu Sdn Bhd to invest RM100 million in Sabah’s first integrated scheduled waste management facility. Tex Cycle will hold a 51% stake in the joint venture while Evolusi Bersatu, an oil and gas services firm, will own the remaining 49%.

The facility is expected to start construction in the second half of this year and will be fully operational by the fourth quarter of 2025.

Datuk Keh Chuan Seng is the largest shareholder in Tex Cycle with a 26.44% stake, held via his private vehicle Frazel Group Sdn Bhd. He was appointed as the group’s executive chairman in May last year after emerging as its substantial shareholder.

Tex Cycle’s executive director Lee Hai Peng also surfaced as the group’s substantial shareholder in May last year, with a 5.129% equity interest.

Their blocks of shares were acquired from Tex Cycle’s previous major shareholder Can Cycle Sdn Bhd, which disposed of its entire 31.57% stake.

Tex Cycle’s net profit for the first quarter ended March 31, 2024 rose by almost four-fold to RM6.6 million from RM1.75 million a year earlier, thanks to a disposal gain. Quarterly revenue fell 12.23% year-on-year to RM8 million from RM9.11 million  

Tex Cycle's share price closed up four sen or 2.9% at RM1.34, valuing the group at RM343 million. Year to date, the stock has surged by 94%.

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