(From left) WTEC Group Bhd non-executive director Eu Tiong Nam, group ED Andy Tiow See Yen, group managing director Tan Kok Kheng, non-executive chairperson Teresa Tan Siew Kuan, Alliance Islamic Bank Bhd CEO Rizal Il-Ehzan Fadil Azim, Alliance Bank Malaysia Bhd group chief corporate & institutional banking officer Teoh Chu Lin, and Alliance Islamic Bank Bhd head/SVP corporate finance, Islamic capital markets Tee Kok Wah, at WTEC Group Bhd’s IPO prospectus launch on Wednesday, in conjunction with its upcoming debut on the Ace Market of Bursa Malaysia. (Photo by Suhaimi Yusuf/The Edge)
KUALA LUMPUR (April 9): WTEC Group Bhd on Wednesday launched its initial public offering (IPO) on the ACE Market of Bursa Malaysia, braving a global stock market rout triggered by the looming Trump tariffs.
The foam and fabric products maker is pricing its shares at 25 sen apiece. The share sale comprises 90.2 million new shares and 43.2 million existing shares, which will collectively offer investors close to 28% in the company headquartered in Semenyih, Selangor.
Application for the IPO will close on April 15, with the company scheduled for listing on April 29.
“This momentous milestone reflects not just our growth over the past two decades, but also our ambition to scale to new heights in the manufacturing and trading of foam and non-foam products,” managing director and co-founder Tan Kok Kheng said at the prospectus launch on Wednesday.
The IPO comes at a time when investors are bracing for the sweeping tariffs that will come into force at 0401 GMT, or 12.01pm Kuala Lumpur time, hitting all of US trading partners. The FBM KLCI was down more than 30 points, or over 2% at noon.
At the IPO price of 25 sen per share, WTEC Group would have a market capitalisation of RM120 million. Upon listing, the company will be valued at nearly 15 times its 2024 earnings.
The public issue is expected to raise gross proceeds of RM22.54 million. WTEC Group has allocated 41.81% for the purchase and renovation of a new factory, 13.1% for the purchase of new machinery and equipment, 4.44% for sales and marketing expenses, and 22.70% for working capital.
The rest is to defray estimated listing expenses.
WTEC Group mainly manufactures foam products made from plastics with air-filled pockets used in industries from automotive to electronics. The company also makes non-woven fabric parts, used as padding for armrests in cars and lining for car seats.
The company posted a profit after tax of RM8.20 million, on revenue of RM52.03 million in FY2024, from serving clients such as APM Automotive Holdings Bhd (KL:APM) and Toyota Boshoku UMW Sdn Bhd.
Out of the 90.2 million new shares, 24 million shares will be made available to the Malaysian public via balloting, while 9.6 million shares will be for eligible persons. The remaining 56.6 million new shares are set aside for Bumiputera investors through private placement.
An offer for sale of existing shares through private placement, meanwhile, will involve 39.8 million shares for select investors, and the remaining 3.4 million set aside for Bumiputera investors.
Any proceeds from the offer for sale will accrue entirely to selling shareholders Tan, executive director Tiow See Yen and Wansern Marketing Sdn Bhd. Wansern Marketing is equally owned by brothers Eu Tian Chiek, Eu Tiong Nam, and Eu Tiong Lai, as well as their brother-in-law Kam Tang Lim.
Alliance Islamic Bank is the principal adviser, sponsor, sole underwriter and placement agent for the IPO.
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