KUALA LUMPUR (Nov 19): Frozen food distributor Supreme Consolidated Resources Bhd (KL:SUPREME), which is heading for a listing on the ACE Market on Nov 29, had its public issuance of 8.6 million new shares oversubscribed by 349.42 times.
In a statement on Tuesday, Supreme Consolidated said it received 23,955 applications for 3.01 billion new shares from the Malaysian public. Of this, a total of 11,984 applications were received from public Bumiputera investors for 1.37 billion shares, representing an oversubscription rate of 317.38 times.
The remaining public portion saw 11,971 applications for 1.64 billion new shares, reflecting an oversubscription rate of 381.46 times.
The initial public offering (IPO) — which will see Supreme Consolidated’s securities transferred from the LEAP Market — comprises a public offering of 70 million new shares with no sale of existing shares.
The bulk or 53.75 million new shares will be placed out to Bumiputera investors approved by the Ministry of Investment, Trade and Industry.
Besides the 8.6 million new shares for the application by the Malaysian public, Supreme Consolidated also issued 7.65 million shares for application by directors, employees and business associates of the company.
Additionally, the 7.65 million new shares made available for application by the group’s eligible directors, key senior management, employees business associates and its subsidiaries have been fully subscribed.
The group 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.
Based on its IPO price of 25 sen per share, the IPO is expected to raise RM17.5 million.
About two-thirds of the IPO proceeds will be used to part-finance the expansion of the company's warehouse, while the rest will be used as working capital and to defray listing expenses.
The expansion includes an additional distribution centre and catering to more products, Supreme Consolidated said. There will be a new warehousing area, with cold storage facilities such as a freezer and chiller room, office, loading, and unloading bay.
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 Supreme Consolidated executive chairman Datuk Richard Wee Liang Chiat, his wife Dona Amat Drury, and his two sons.
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.