KUALA LUMPUR (Sept 26): Supreme Consolidated Resources Bhd (KL:SUPREME), a distributor of frozen food products, has signed an agreement with Kenanga Investment Bank to underwrite its initial public offering (IPO) on the ACE Market.
Under the agreement, Kenanga will underwrite shares to be offered to the Malaysian public and eligible persons under the pink form allocation, Supreme Consolidated said in a statement. The company is expected to be listed on the ACE Market in the fourth quarter of 2024.
Currently listed on the LEAP Market, the transfer to ACE Market is expected to “boost our liquidity through a wider investor base, enhance our company’s visibility and draw in new partners”, said executive chairman Datuk Richard Wee Liang Chiat.
“We believe that it will also grant us a much larger platform for raising funds, giving us access to extra capital that will facilitate our expansion plans and support investments in strategic projects,” he said.
The company distributes third-party brands as well as its own brands of frozen and chilled food products such as frozen meat and seafood, ambient food and beverages including milk, pasta and juices, and goods such as detergents and toothpaste.
For the financial year ended Sept 30, 2023 (FY2023), Supreme Consolidated posted a profit after tax of RM9.22 million on revenue of RM199.64 million.
The proposed IPO consists entirely of 70 million new shares at a price to be determined later, according to its draft prospectus. The company is allocating 8.6 million shares to the public and 7.65 million shares to eligible persons.
The public issue also involves 53.75 million shares through private placement to Bumiputera investors approved by the Ministry of Investment, Trade and Industry.
Proceeds from the IPO have been earmarked for the expansion of its warehouse facility, which will serve as an additional distribution centre for the company and cater to the expansion of its products. The company also plans to allocate some of the IPO proceeds for its day-to-day operations.
BNDM Incorporated Holdings Sdn Bhd is the largest shareholder of Supreme Consolidated, holding 40.67%, followed by Lim Ah Ted with a 26.25% stake. BNDM is controlled by Wee, his wife Dona Amat Drury, and his two sons.
Lim, meanwhile, stepped down as managing director of Supreme Consolidated in March 2024 but remained as a director in all of its subsidiaries.
Post-IPO, BNDM’s interest will be diluted to 34.05% while Lim’s holdings will fall to 21.98%.
Kenanga is the principal adviser, sponsor, underwriter and placement agent for the IPO.