HLIB Research said Helm’s established global presence in the chemicals industry may help expand Ancom Nylex’s international market reach.
PETALING JAYA: The presence of Germany-based chemical firm Helm AG as a substantial shareholder in integrated chemical group Ancom Nylex Bhd
will, among others, enhance the latter’s expansion into international markets.
Hong Leong Investment Bank (HLIB) Research said Ancom Nylex can tap into Helm’s expertise in active ingredients and crop protection formulations to enhance its agrichem business.
Furthermore, it said Helm’s established global presence in the chemicals industry may help expand Ancom Nylex’s international market reach.
Founded and based in Germany since 1900, Helm is one of the largest independent chemicals companies in the world, predominantly involved in chemicals marketing (feedstocks and derivatives), crop protection, fertiliser and pharmaceutical industries.
Ancom Nylex is undertaking a private placement of up to 10% of its issued shares.
The company recently announced a conditional placement agreement with Helm at RM1 per share, raising gross proceeds of up to RM96.2mil.
Of this amount, RM56mil would be used to repay borrowings, RM39.2mil for general working purposes and RM1mil for estimated placement expenses.
The corporate exercise is expected to be completed by the fourth quarter of 2024, barring any unforeseen circumstances.
HLIB Research has maintained its “buy” call on Ancom Nylex with a target price of RM1.26 per share.
Post annual report updates, the research house has reduced its financial year 2025 (FY25) and FY26 forecasts by 4%, and introduced FY27 earnings estimate of RM119mil.
The brokerage likes the company for being the sole large-scale producer of active ingredient (AI) herbicides in South-East Asia, a segment with high barrier to entry and significant earnings growth potential from a pipeline of new AIs.
