KUALA LUMPUR (June 26): Enproserve Group Bhd, a mechanical and engineering services firm, has priced its initial public offering (IPO) at 24 sen per share for its ACE Market listing.
The IPO is expected to raise RM50.4 million for the company’s capacity and capability expansion, and another RM25.2 million for the selling shareholder, according to its prospectus launched on Thursday. All in all, the share sale is expected to raise up to RM75.6 million.
Applications for the IPO shares will close on July 8 and listing has been scheduled for July 18.
Enproserve’s group managing director Azman Yusof will pocket the entire RM25.2 million from sale of a portion of his stake in the company. Azman will retain a 70% stake in Enproserve worth about RM252 million upon listing.
Founded in 2001 in Kemaman, Terengganu, the company mainly serves the oil and gas and petrochemical industries.
Enproserve currently focuses on providing plant maintenance and turnaround services; engineering, procurement, construction and commissioning (EPCC); as well as facility management services. The company also provides other related activities including the rental of equipment and vehicles, and supply of manpower.
About two-thirds of the IPO proceeds to the company have been allocated for capital and operational expenditure.
Enproserve intends to enhance its capacity and capabilities in plant maintenance and turnaround, EPCC, as well as investing in heavy lifting equipment for operational use as well as external rental.
The remaining RM11.65 million has been allocated for repayment of bank borrowings, while RM10.05 million will be utilised for working capital requirements.
As it stands, Enproserve has 19 ongoing contracts to provide plant maintenance and turnaround services in Johor, Melaka, Terengganu and Pahang. The contracts will keep the company busy until 2029, though some contracts come with options for extension.
The IPO involves a public issue of 210 million new shares, of which 139.18 million shares are set aside for selected investors via private placement. The Malaysian public, meanwhile, is allocated 52.5 million shares for application and 18.3 million shares will be reserved for eligible persons.
The offer for sale of existing shares will be done through private placement to selected investors.
KAF Investment Bank is the principal adviser, sponsor, sole placement agent and sole underwriter for this IPO exercise.