KUALA LUMPUR (Sept 6): Pantech Global Bhd, a steel pipe manufacturer, has filed for an initial public offering on the Main Market to raise funds for expansion, including for the construction of a new plant and acquisition of an existing factory.
The company was a special purpose vehicle formed for the purpose of listing Pantech Group Holdings Bhd’s (KL:PANTECH) two wholly-owned subsidiaries — Pantech Stainless & Alloy Industries Sdn Bhd (PSA) and Pantech Steel Industries Sdn Bhd (PSI).
The proposed IPO will comprise 262.23 million new shares at a price to be determined later, according to the draft prospectus posted to the Securities Commission Malaysia. There is no separate sale of existing shares.
“To cater for our expansion in business operations, we intend to establish a new corporate head office and factory in Klang, Selangor by 2027,” Pantech Global said. “Part of our plans for this new factory includes warehouse and workers’ accommodation.”
Plans are also afoot to set up a new warehouse in Pasir Gudang, Johor by 2027 and build a new pickling plant.
Pantech Global is involved in the manufacturing of butt weld pipe fittings and stainless-steel welded pipes in Klang and Johor. For the financial year ended Feb 29, 2024, Pantech Global recorded a net profit of RM49.71 million on revenue of RM440.94 million.
Under the public issue, Pantech Global is allocating 21.25 million new shares to the Malaysian public via balloting, with half set aside for Bumiputera investors. The company is also selling 29.75 million IPO shares to eligible persons.
Shareholders of parent Pantech Group, meanwhile, would be entitled to one IPO share of Pantech Global for every 25 existing shares held, for a total of 35 million shares.
Pantech Global will also market 69.98 million IPO shares through private placement to selected investors, with a total of 106.25 million IPO shares allocated for private placement to approved Bumiputera investors.
On top of expansion of operating facilities, proceeds to be raised from the public issue have also been earmarked for the acquisition of lands and buildings as well as to purchase and upgrade machineries, repayment of bank borrowings, and to meet working capital requirements.
Post-IPO, Pantech Group will still own 69.15% in Pantech Global.
Alliance IslamicBank is the principal adviser, sole bookrunner and sole underwriter for the IPO.