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KUALA LUMPUR (Aug 12): Pioneer Heat Holdings Bhd is opening its initial public offering (IPO) application at 25 sen per share.
The company aims to raise RM26.02 million from the listing on the ACE Market.
Of this, RM21.68 million will go to the company, while RM4.34 million will go to its three promoters, who are also brothers — Wong Hing Chong, Wong Hing Kok and Wong Heng Chong.
“The launch of prospectus marks a significant milestone in Pioneer Heat’s corporate journey as we move closer towards our listing on the ACE Market,” the company’s CEO and executive director Wong Wei Ken said during the prospectus launching ceremony.
“Through this IPO, we aim to strengthen our operational capacity, expand our regional presence and enhance our service capabilities,” said Wei Ken, who is also the son of Hing Chong.
Applications for the IPO will close on Sept 3 and listing has been scheduled for Sept 17.
Pioneer Heat is principally involved in mechanical engineering services and civil engineering projects for the construction of industrial and ancillary facilities.
Its mechanical engineering services include piping system engineering and specialised services such as heat treatment, flange management and non-destructive testing, primarily serving the oil and gas, petrochemical, utility and manufacturing sectors.
Proceeds from the IPO have been earmarked, with RM4 million to set up a new headquarters in Sendayan, Negeri Sembilan, and RM2.07 million for a new office and workshop in Sarawak.
The Sendayan headquarters is intended to house administrative offices, a workshop and a warehouse to support fabrication works, heat treatment services and equipment maintenance, while the Sarawak facility is aimed at expanding the company’s capacity to undertake larger projects in East Malaysia.
The company is also allocating RM4.01 million for the purchase of machinery and equipment. The remaining RM11.6 million will be used for working capital and to cover listing expenses.
The company will have a market capitalisation of RM86.73 million based on its IPO price upon listing. The Wong brothers will reduce their combined stake in Pioneer Heat to 53.7%, from about 78.2% before the listing.
They will remain as substantial shareholders. Hing Chong and Hing Kok will each see their direct stakes diluted to 20.1% from 29.4%, while Heng Chong’s holding will be pared down to 13.5% from 19.4%, based on the enlarged share capital after listing.
Malacca Securities Sdn Bhd is the principal adviser, sponsor, underwriter and placement agent for the proposed listing.