KUALA LUMPUR (June 24): Eckem Holdings Bhd said the shares offered to the public by the industrial chemicals company have been oversubscribed by 8.09 times ahead of its listing on the ACE Market of Bursa Malaysia on July 3.
Investors applied for 284.03 million shares worth RM34.08 million for the 31.25 million shares offered under the initial public offering (IPO), the company said in a statement on Wednesday.
The oversubscription rate is 4.24 times for the Bumiputera portion and 11.94 times for the other Malaysians' portion.
The company said shares reserved for eligible persons were also fully subscribed after applying the relevant clawback and reallocation provisions as set out in the prospectus.
Eckem said the 46.88 million issue shares made available via private placement to selected investors have also been fully allotted.
A total of 78.13 million IPO shares, comprising 15.63 million issue shares and 62.5 million offer shares, allocated to selected Bumiputera investors approved by the Ministry of Investment, Trade and Industry (Miti) have been fully placed out.
Headquartered in Shah Alam, Eckem mainly sells speciality industrial resins, pigments and additives used in paints, construction materials, personal protective equipment, inks, household products and adhesives.
The IPO, priced at 12 sen per share, raised RM15 million for the company. Eckem’s founder Tan Kwang Wah, his wife and two sons together pocketed RM7.5 million from an offer for sale of their shares through the IPO.
Eckem is setting aside 40% of the funds raised from the public issue for construction of a new corporate office, warehouse and laboratory. The company is allocating 13% of the proceeds for expansion of a new production line for rubber products.
The rest will be used to repay bank borrowings, as working capital and to cover listing expenses.
M&A Securities is the adviser, sponsor, underwriter and placement agent for the IPO.