KUALA LUMPUR (May 20): Pentech Holdings Bhd has launched its initial public offering (IPO) on the ACE Market, aiming to raise RM34.4 million to fund technology upgrades and expansion plans.
The IPO is priced at 20 sen per share, according to its prospectus released on Wednesday. There is no accompanying offer for sale, meaning that existing shareholders are not cashing out of the computer infrastructure company under the IPO.
Applications for the IPO will close on May 29 and listing is scheduled for June 15.
Based in Penang, Pentech mainly integrates enterprise information and communication technology infrastructure, supplies hardware and software, and provides cloud and other services.
Upon listing, Pentech is expected to command a market capitalisation of RM124 million, valuing the company at a little under 12 times the latest year’s earnings.
“We believe this IPO will support our next phase of growth through enhancement of technological capabilities, strengthening of operational capacity and expansion of market presence,” managing director and chief executive officer Yeoh Chin Ming said at the prospectus launch.
Of the total proceeds, about 70% will be allocated towards expansion, including RM9.4 million to establish a new security operations centre, RM8.1 million to upgrade the operations command centre infrastructure, and RM6.74 million to expand its service offerings.
Another RM3.5 million has been earmarked for marketing and promotional activities, RM2.16 million for working capital, while RM4.5 million will be used to defray listing expenses.
Yeoh, a seasoned salesman who joined Pentech as a sales executive in 2010, became its chief executive officer more than a decade later. Along the way, he bought out two other co-founders and now controls 52% of Pentech.
Pentech is well-positioned to benefit from Malaysia’s growing digital economy amid rising demand for cybersecurity, cloud adoption and resilient digital infrastructure, said Public Investment Bank chief executive officer Lee Yo-Hunn.
“As businesses increasingly prioritise operational efficiency, cybersecurity, cloud adoption and resilient digital infrastructure, having reliable partners with proven execution capabilities and strong service delivery records has become critical,” he said.
Public Investment Bank is the principal adviser, sponsor, sole underwriter and sole placement agent for the IPO.