KUALA LUMPUR (Feb 17): Chemlite Innovation Bhd, which provides surface finishing treatment services, has secured approval from Bursa Malaysia for an initial public offering (IPO) on the ACE Market.
 
The approval marks another step forward for the Penang-based company, which specialises in both metal plating and non-metal plating services, primarily catering to semiconductors, electrical and electronics (E&E) and machinery and equipment (M&E) sectors. The company filed a draft prospectus in September.
 
“Obtaining the approval from Bursa Securities and the support of UOB Kay Hian for underwriting Chemlite Innovation’s IPO shares marks a significant milestone in the company’s journey,” said founder and chief executive officer Chong Yuen Fong
 
Meanwhile, his co-founder and chief operating officer Heng Chee Khiang added that, “The IPO proceeds will enable us to enhance and expand our facilities, invest in automation and drive R&D initiatives, all of which will position Chemlite Innovation as a leading surface finishing treatment solutions provider for a diverse range of industries.”
 
Chemlite is raising funds from its IPO for expansion, which includes setting up a new facility, housing at least four fully automated anodising lines and four semi-automated metal plating lines and adding two cleanrooms for cleaning and packaging services, which are expected to start by the third quarter of 2025.
 
The land acquisition for the new facility is expected to be completed by the second quarter of 2025, with construction targeted for completion by the fourth quarter of 2026.
 
The IPO involves a public issue of 120 million new shares and offer for sale of 60 million existing shares, according to its draft prospectus. All in all, the listing would offer investors up to a 30% stake in the company.
 
Out of the 120 million new shares, the company is allocating 30 million to the public, 21 million to eligible persons, 15 million to Bumiputera investors through private placement, and 54 million to identified institutional and select investors by means of private placement.
 
The sale of existing shares meanwhile will also be done through private placement for Bumiputera investors.
 
Proceeds from the IPO will also be used for capital expenditure on machinery and equipment, establishing a research and development department, as well as for partial repayment of bank borrowings, meeting working capital requirements, and to defray listing expenses.
 
Meanwhile, any proceeds from the offer for sale through private placement will accrue entirely to Chong and Heng. Post-listing, Chong’s stake will be trimmed to 38.5% while Heng’s direct holdings will be diluted to 31.5%.
 
UOB Kay Hian is the IPO’s principal adviser, sponsor, underwriter and placement agent.
 
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Penang-based Chemlite files for ACE Market IPO to raise funds for new facility