KUALA LUMPUR (Jan 29): Penang-based precision engineering services provider Ambest Group Bhd saw the retail portion of its initial public offering (IPO) oversubscribed by 46.07 times ahead of its listing on the ACE Market of Bursa Malaysia on Feb 6.
The company received applications for 1.2 billion shares for the 25.5 million shares offered to the public, according to its statement on Thursday.
The Bumiputera portion was oversubscribed by 27.66 times, while the public portion was oversubscribed by 64.48 times.
Another 12.75 million shares set aside for the eligible persons under the IPO were also fully subscribed.
Ambest is aiming to raise as much as RM37.74 million from the IPO, based on the offer price of 25 sen per share.
The company is allocating RM27.5 million from fresh capital to fund its growth plans, while the RM10.24 million raised from the offer-for-sale will accrue to selling shareholders and co-founders Tan Beng Beng and Lim Eng Guan.
Of the proceeds raised from new shares, RM12 million or 43.6% will be used to repay bank borrowings taken to part-finance the acquisition of Facility 42A. As at the latest practicable date (LPD), Ambest’s total borrowings stood at RM35.89 million.
Meanwhile, RM3.9 million or 14.2% of the IPO proceeds will be allocated for the purchase of two advanced machines — a five-axis computerised numerical control (CNC) machine and a CNC horizontal machine — both of which will be installed at Facility 42A.
These machines are expected to collectively increase Ambest’s annual operating capacity by about 4%, according to the prospectus.
Beyond capacity expansion, about RM6.8 million or 24.7% of the IPO proceeds will be allocated to general working capital to support day-to-day operations, including raw material purchases.
Approximately RM4.8 million or 17.5% will be used to defray listing-related expenses.
Ambest primarily serves the semiconductor industry, offering precision machining of customised parts and components that require close-tolerance accuracy. The group also provides value-added services such as sub-modular assembly and surface finishing treatments.
Its manufacturing capabilities include milling, turning and turn-milling, supported by a fleet of 44 CNC milling machines, two CNC turning machines and seven CNC turn-milling machines.
Malacca Securities Sdn Bhd is the principal adviser, sponsor, underwriter and placement agent for the IPO, while WYNCORP Advisory Sdn Bhd serves as the corporate finance adviser.