KUALA LUMPUR (May 14): ACE Market-bound Signature Alliance Group Bhd, a subsidiary of Signature International Bhd (KL:SIGN), is advancing its regional expansion plans with a focus on Penang and Johor to establish brand offices.
At a press conference after its prospectus launch on Wednesday, executive director and group chief executive officer Darren Chang said the company is exploring rental properties with an estimated built-up area of 12,000 sq ft in Penang and 5,000 sq ft in Johor.
The expansion sees it further diversifying its revenue base geographically, which is largely contributed by the central region comprising Kuala Lumpur, Selangor, Putrajaya, and Negeri Sembilan (76.9% of group revenue in 2024).
Penang, alongside Kedah and Perak, accounted for 19.9% of the group’s revenue for the year, whereas Johor and Melaka contributed 2.5% combined, Chang said.
Other contributions for the group, whose core business is to provide interior fitting-out services, furniture production, and building construction works, came from Pahang (0.5%) and Sarawak (0.2%).
WATCH: Signature Alliance eyes Johor, Penang expansion
Signature Alliance seeks to raise RM161.2 million via issuance of 260 million new shares (26% of its enlarged share capital) at 62 sen apiece.
The IPO values the group at RM620 million, or 15.28 times price-earnings ratio based on its profit after tax of RM40.56 million for the financial year ended Dec 31, 2024.
In Selangor, Signature Alliance plans to allocate RM88.0 million — equivalent to 54.6% of the gross proceeds from its RM161.2 million IPO — for land acquisition and construction of a 50,000 sq ft production facility on-site, located adjacent to its new headquarters.
The group also announced plans to propose an annual dividend payout ranging from 30% to 50% of its net profit, subject to cash flow and prevailing business conditions. Its order book stood at RM388.6 million as at April 16.
On its prospects, Chang said the group sees growth in the next few years. Asked on the potential US tariffs, Chang does not anticipate any impact mainly because the group's materials are sourced locally.
Following the IPO, Signature International's stake in the company will fall to 37.5%. The combined 49.3% stake held by Chang, northern region CEO Foo Khai Shin and central region CEO Ng Mun Moh will be reduced to 36.5% after the IPO.
Applications for the IPO close on May 21, and the listing is set for June 5.