From left: Sik Cheong executive director Wong Hin Loong, managing director Wong Hing Ngiap, TA Securities executive director Tah Heong Beng and senior manager of corporate finance Abdul Muiz Mustafa
KUALA LUMPUR: ACE Market-bound Sik Cheong Bhd has inked an underwriting agreement with TA Securities Holdings Bhd for 17.3 million new shares made available to the Malaysian public and pink form subscribers.
In a statement, the RBD palm olein oil repackaging firm said its initial public offering (IPO) exercise involves the public issuance of 66 million new shares, representing 24.8% of its enlarged share capital and an offer for sale of 20 million existing shares via private placement to selected investors.
Out of the 66 million new shares, 13.3 million shares will be made available to the Malaysian public through balloting, four million shares to eligible directors, employees and persons who have contributed to the success of Sik Cheong, while the remaining 48.7 million shares are reserved for private placement to selected investors.
Sik Cheong's RBD palm olein oil products, mainly cooking oil, are its primary source of revenue, sold under the in-house Sawit Emas and Vitamas brands as well as unbranded options.
“Sik Cheong is a sustainable business given that RBD palm olein cooking oil is an essential food ingredient used in a diverse range of daily food manufacturing and preparation processes.
"RBD palm olein oil also offers a more cost-effective option over alternatives, making it one of the most widely consumed cooking oils," said managing director Wong Hing Ngiap.
The group, which is scheduled to list on Bursa Malaysia in the third quarter of 2024, said it plans to strategically expand its product range to include oleic soybean oil.
It also intends to increase its reach beyond Kuala Lumpur and Selangor to neighbouring states such as Perak, Negeri Sembilan, Melaka, and Pahang, aiming to capture a larger market share for the distribution of the group’s products.
TA Securities is the principal adviser, sponsor, sole underwriter and placement agent for the IPO exercise.
