KOTA KINABALU (Oct 22): Beverage manufacturer Life Water Bhd has launched its initial public offering (IPO) that would raise RM81.87 million for its listing on the Main Market.
Priced at 65 sen per share, the IPO would give the Sabah-based company a market capitalisation of RM307.57 million, nearly 11 times the net profit for the financial year ended June 30, 2024 (FY2024), according to the prospectus unveiled on Tuesday.
Application for the IPO shares will close on Oct 30, and listing has been scheduled for Nov 13.
The IPO entails a public issue of 97.56 million new ordinary shares, and an offer for sale of 28.39 million existing ordinary shares to selected investors by way of private placement. All in, the listing offers investors a 26.62% stake in the Sabah-based company.
Life Water expects to raise RM63.42 million from the public issue, while the offer for sale will raise RM18.45 million, which will go entirely to selling shareholders Liaw Hen Kong, Chin Lee Ling, Tan Hwong Kuen, and Lim Young Piau.
Liaw is the group’s managing director, while his spouse Chin is an executive director. Both Tan and Lim are non-executive senior directors.
Out of the proceeds raised from the sale of new shares, RM19 million will be used for setting up an additional drinking water manufacturing line for Sandakan Sibuga Plant 1. The company has also earmarked RM12 million to buy a drinking water manufacturing line for Sandakan Sibuga Plant 2.
The company has also set aside RM12.6 million to set up a second distribution centre in Sandakan, RM9.61 million for the expansion of existing plastic packaging facilities in Kota Kinabalu, and RM4.21 million for funding the working capital requirements. The rest is to defray listing expenses.
Under the public issue, 23.66 million issue shares would be made available for application to the Malaysian public, followed by 14.20 million issue shares made available for eligible persons. The company is also allocating 560,000 issue shares for private placement to selected investors.
The remaining 59.14 million issue shares would be made available by way of private placement to approved Bumiputera investors.
Life Water’s net profit rose to RM28.12 million in FY2024, from RM20.62 million in FY2023, and RM15.74 million in FY2022. Revenue also rose to RM166.53 million in FY2024, from RM150.96 million in FY2023, and RM121.4 million in FY2022.
MIDF Amanah Investment Bank Bhd is the principal adviser, underwriter, and placement agent for the IPO.