KUALA LUMPUR: MKH Oil Palm (East Kalimantan) Bhd’s (MKHOP) initial public offering (IPO) has been oversubscribed by 8.4 times ahead of its listing on the Main Market of Bursa Malaysia Securities Bhd.
The group's IPO involves the issuance of 220.0 million new ordinary shares in MKHOP at an issue price of 62 sen per share. This represents 21.5% of its enlarged share capital, resulting in IPO proceeds totalling RM136.4mil.
Additionally, there is also an offer for sale of 30.7 million existing shares, or 3.0% of the enlarged shares by way of private placement to selected investors.
The oil palm plantation player has received a total of 9,510 applications for 482.9 million shares with a value of approximately RM299.4mil for the 51.2 million shares allocated to the Malaysian public, representing an oversubscription rate of 8.4 times.
For the Bumiputera category, there were a total of 4,628 applications received for 220.2 million shares, translating into an oversubscription rate of 7.6 times.
As for the other Malaysian public category, 4,882 applications were received for 262.6 million shares, representing an oversubscription rate of 9.3 times.
In addition, the private placement of 168.8 million shares for selected investors have also been fully placed out.
"We value the public's support for our Group’s capabilities and future potential. With the IPO funds, we are well-equipped to pursue our expansion strategy, which includes acquiring new land in the vicinity of our existing plantation estates to expand our plantation landbank,” non-independent non-executive chairman Tan Sri Chen Kooi Chiew @ Cheng Ngi Chong said in a statement.
"Furthermore, our efforts will be directed towards enhancing our operational efficiency and increasing our processing capabilities and product offerings, supported by investments in new machinery and equipment. A key initiative includes the new palm kernel (PK) crushing facility to crush and press PK for extraction and processing into crude palm kernel oil and palm kernel expeller, thereby diversifying our revenue streams.”
MKHOP is set to debut on the Main Market of Bursa Malaysia on April 30.
Upon listing, MKHOP’s market capitalisation will be RM634.6mil, based on the issue price of 62 sen per share and its enlarged share capital of 1.02 billion shares.
M & A Securities Sdn Bhd is the adviser, managing underwriter, joint underwriter and joint placement agent of the IPO exercise, while Kenanga Investment Bank Bhd
is the joint underwriter and joint placement agent, and AmInvestment Bank Bhd is the joint placement agent.
