KUALA LUMPUR (Nov 11): ASM Automation Group Bhd, an automation machinery solutions provider primarily for the food and beverage manufacturing industry, has filed for an initial public offering (IPO) on the ACE Market to raise funds for expansion and working capital.

The bulk of the proceeds from the public issue will be used to acquire new land and to construct a new double-storey factory with a gross built-up area of 50,000 sq ft, consisting of an office, showroom and warehouse.

Further, the company plans to purchase additional new machines and major equipment and parts for the assembly of demonstration machinery.

The demonstration machinery is to facilitate engagement with potential customers.

It also plans to enhance its design and development activities by hiring additional personnel and investing more in development costs.

For the year ended March 31, 2024, ASM Automation made a net profit of RM7.11 million on revenue of RM39.13 million. About 44.8% of its total revenue is made locally, while the remaining 55.2% are from overseas.  

The top three overseas markets are Vietnam, which contributes 24.9% of its total revenue, followed by the Philippines (13%) and India (6.6%).

Liwayway Group, a snack company originating from the Philippines with operations in Asean countries that carries the Oishi brand, is ASM Automation’s largest customer, contributing 23.8% to its revenue. Both parties have been in business for 10 years.

The proposed IPO involves a public issue of 128.34 million new shares and an offer for sale of 53.48 million existing shares at a price to be determined later, the draft prospectus showed. All in all, the listing would offer investors up to a 34% stake in the company based in Lahat, Perak.

Meanwhile, the proceeds from the sale of existing shares will go to managing director Chan Kok Heng and executive director Leong Weng Khin.

M&A Securities is the IPO's principal adviser, sponsor, underwriter and placement agent, while Eco Asia Capital Advisory Sdn Bhd is the financial adviser.