From left: MKHOP independent non-executive director Yahya Ariffin, executive director Emily Chen Wei Chyong, executive director Datuk Andy Lee Khee Meng, non-executive director Tan Sri Eddy Chen, chairman Tan Sri Alex Chen, M&A Securities Sdn Bhd managing director Datuk Bill Tan, Kenanga Investment Bank Bhd head of group investment banking Datuk Roslan Hj Tik and AmInvestment Bank Bhd head of ECM Syndication Freddy Kong
KUALA LUMPUR: MKH Oil Palm (East Kalimantan) Bhd (MKHOP) is set to raise RM136.4mil from its initial public offering (IPO), en route to a listing on the Main Market of Bursa Malaysia on April 30, 2024.
In a statement, the plantations firm said RM42mil of the IPO proceeds wll be used to acquire lands for oil palm plantation within the East Kalimantan province while RM9mil will be allocated for the setting up of a palm kernel crushing facility to provide the group with an additional income stream.
An additional RM42mil will go to capital expenditure for existing plantation lands, refurbishment and/or upkeep of existing palm oil mill, refurbishment and construction of workers/staff housing quarters, and expansion of electricity supply.
A further RM30mil will go towards repayment of loans while the remaining Rm13.4mil will be deployed as working capital and to cover listing expenses.
"The IPO proceeds will accelerate our growth plans, which include expanding our plantation landbank by acquiring lands located near our existing estates to leverage on our existing processing and jetty facilities.
"We will also invest in new machinery and equipment to enhance operational efficiency, increase processing capabilities, and broaden our product offerings,” said said non-independent non-executive chairman Tan Sri Chen Kooi Chiew @ Cheng Ngi Chong.
According to MKHOP, the IPO exercise comprises a public issue of 220 million new ordinary shares in MKHOP, or 21.5% of its enlarged share capital, and an offer for sale of 30.7 million existing Shares, or 3% of the enlarged shares by way of private placement to selected investors.
Out of the 220 million new shares, 51.21 million shares will be made available for application by the Malaysian public via balloting, while the remaining 168.79 million new shares wil be reserved for private placement to selected investors.
With an enlarged issued share capital of 1.02 billion shares and an IPO price of 62 sen per share, MKHOP will have a market capitalisation of RM634.6mil upon listing.
The group said it intends to maintain a dividend policy to distribute at least 50% of its annual net profit.
Applications for the public issue will be closed on April 16, 2024 at 5pm.
