From left: Lagenda Properties head of investments and investor relations Jasrinderjit Dhillon, Northern Solar executive director Edward Chew, managing director Lew Shoong Kai, M&A Equity Holdings Bhd managing director Datuk Bill Tan, M&A Securities head of corporate finance Gary Ting and deputy head of corporate finance Rachel Ho
KUALA LUMPUR: Northern Solar Holdings Bhd has signed an underwriting agreement with M&A Securities Sdn Bhd for its listing on the ACE Market of Bursa Malaysia.
In a statement, the solar renewable energy specialist said the initial public offering (IPO) entails a public issue of 67.3 million new shares and an offer for sale of 35.6 million existing shares, representing 17% and 9% of the enlarged share capital of Northern Solar respectively.
M&A Securities will underwrite a total of 27.7 million new shares made available to the Malaysian public and pink form allocations.
The remaining 39.6 million new shares will be placed out to Bumiputera investors approved by the Ministry of Investment, Trade and Industry (Miti).
For the offer for sale portion, 9.9 million shares are reserved for private placement to Bumiputera investors approved by the Miti while the remaining 25.7 million shares will be allocated by way of private placement to selected investors.
Northern Solar is principally involved in the engineering, procurement, construction and commissioning (EPCC) of solar photovoltaic (PV) systems, generation of renewable energy as well as operations and maintenance of solar PV equipment and systems.
Over the years, the company has accumulated established track record by undertaking different types of on-grid solar PV systems for residential, commercial and industrial (C&I) buildings under the Net Energy Metering (NEM) and Self-Consumption (SELCO) programmes.
Northern Solar managing director Lew Shoong Kai said the IPO exercise is timely for the company as it will enable it to tap into the equity capital market to raise funds to further expand its solar PV systems business.
“The number and size of EPCC of solar PV system projects that we can undertake at any point in time depends largely on the availability of our working capital.
"If we are to expand our business and secure more and larger contracts, we must increase our available financial resources to satisfy the working capital required to undertake the contracts," he said.
“With applying a portion of the proceeds from the Public Issue to satisfy the various working capital requirements associated with undertaking contract works, our group will be in a better position to tender for and expand our portfolio in the EPCC of solar PV systems segment."
For the financial year ended March 31, 2022 (FY22), Northern Solar’s revenue jumped from RM22.2mil to RM78mil in FY24, registering a two-year compounded annual growth rate (CAGR) of 51.9%.
The company has also recorded a strong growth momentum for its profit after tax from FY22 to FY2024.
Its profit after tax increased from RM3.1mil in FY22 to RM10.1mil in FY2024, registering a two-year CAGR of 48%.
Northern Solar’s substantial shareholders include Lew, Northern Star executive director Edward Chew and Main Market-listed Lagenda Properties Bhd
.
The company is tentatively scheduled to list on the ACE Market of Bursa Securities in February 2025.
M&A Securities is the Adviser, Sponsor, Underwriter and Placement Agent for the IPO exercise.
