KUALA LUMPUR (July 29): Orkim Bhd, an oil and gas shipping company wholly owned by Ekuiti Nasional Bhd (Ekuinas), has filed for an initial public offering (IPO) on Bursa Malaysia’s Main Market to fund fleet expansion with younger, larger, and more versatile tankers.

The IPO comprises an offer for sale of up to 300 million existing shares and a public issue of 100 million new shares, representing 40% of Orkim’s enlarged issued share capital.

The offering will include both institutional and retail tranches, with the final IPO price set at the lower of the indicative retail price or the institutional price determined via bookbuilding.

The Edge had previously reported about Orkim's listing plan, noting that Ekuinas had engaged investment banks for a potential IPO that could value Orkim at up to RM1 billion.

As of June, Orkim operates a fleet of 17 tankers — comprising 15 clean petroleum product (CPP) tankers and two liquefied petroleum gas (LPG) tankers — making it the largest player in Malaysia’s domestic CPP tanker segment.

Proceeds from the IPO will be primarily directed towards vessel acquisition, with 80% earmarked for this purpose. The remaining funds will be allocated to working capital (9%) and listing-related expenses (11%).

The group plans to acquire up to three vessels between 2025 and 2026, with the IPO proceeds specifically intended to finance one of these acquisitions.

Orkim’s top five customers contribute 96.3% to its total revenue. They include Petronas Group, Petron Malaysia, Boustead Petroleum Marketing (BHPetrol), and Japan-based Nippon Gas Line Co Ltd.

The selling shareholder in the IPO is Tetap Kuasa Sdn Bhd, Ekuinas’ investment holding vehicle that currently owns 100% of Orkim.

For the financial year ended Dec 31, 2024, Orkim reported a net profit of RM92.91 million on revenue of RM316.59 million. The group is targeting a dividend payout ratio of between 40% and 70% of profit after tax attributable to shareholders, subject to its working capital requirements.

To bolster investor confidence, Orkim will seek cornerstone investors — typically large institutions such as pension funds and insurers — who commit to purchasing shares ahead of the broader marketing process. In the event of overwhelming demand, the company has also structured an overallotment option involving an additional 15% stake.

CIMB Investment Bank is the principal adviser, joint bookrunner, and managing underwriter for the IPO, while RHB Investment Bank is the joint bookrunner and joint underwriter.