Spring Art to raise RM24.42 million from IPO
KUALA LUMPUR: Ready-toassemble furniture products designer and manufacturer Spring Art Holdings Bhd (Spring Art) expects to raise RM24.42 million under its proposed listing on the ACE Market of Bursa Malaysia Securities Bhd (Bursa Securities) tentatively on November 8 this year.
The company plans to use RM17.55 million or 71.9 per cent raised from the initial public offering (IPO) to acquire new machinery to set up two additional production lines for its new manufacturing factory, Factory C.
The company will further utilise RM3.67 million for general working capital requirements while the remaining RM3.20 million (13.1 per cent) to be used to defray listing expenses for the IPO.
Its managing director Jack Lim Kok Eng said the company expects to set up a new manufacturing factory namely Factory C to expand its current manufacturing capacity.
“We plan to construct Factory C, with a total estimated factory built-up area of approximately 103,926 sq to undertake the manufacturing of office furniture, bedroom furniture, living room furniture and other furniture for export to North America and Europe and for our existing customers,” he said in a statement yesterday.
Factory C, which is expected to commence operations in July 2022, will increase Spring Art’s annual capacity to reach a combined manufacturing capacity of approximately 674,000 units per annum. As at 17 September, Spring Art’s total annual production capacity is 337,016 units.
Under the listing exercise, Spring Art is issuing 97.69 million new shares in Spring Art representing approximately 23.5 per cent of the enlarged share capital.
Of the 97.69 million new shares, 20.78 million new shares will be made available to the Malaysian public via balloting; 4.16 million new shares for its eligible Directors and employees as well as persons who have contributed to the success of Spring Art Group while the remaining 72.75 million new shares are earmarked for private placement to selected Bumiputera investors approved by Ministry of International Trade and Industry Malaysia (MITI) and selected investors.
As part of its listing exercise, the existing shareholders of the Company will also make an offer for sale of 27.02 million shares by way of private placement to selected investors.
Based on the enlarged share capital of 415.69 million shares, Spring Art is expected to have a market capitalisation of RM103.92 million.
The IPO is open for subscription beginning yesterday until October 24, 019. M&A Securities Sdn Bhd is the Adviser, Sponsor, Underwriter and Placement Agent for the IPO exercise.