Matang appoints M&A Securities as IPO underwriter
KUALA LUMPUR: Matang Bhd, which is en route to a listing on the ACE Market of Bursa Malaysia Securities Bhd (Bursa Securities) in the first quarter of 2017, signed an underwriting agreement with M&A Securities Sdn Bhd yesterday in conjunction with its initial public offering (IPO) exercise.
The IPO will involve the issuance of 130 million new shares of 10 sen each in Matang representing 7.18% of the enlarged issued and paid-up share capital of Matang after listing.
M&A Securities will underwrite the entire 130 million new Matang shares to be offered to the Malaysian public via public balloting.
“The appointment of M&A Securities as the underwriter brings Matang another step forward in its IPO exercise. Matang is grateful to have M&A Securities for its wealth of experience and expertise in the role as an adviser as well as underwriter for the IPO exercise of Matang, all of which are invaluable to the company in achieving the listing status,” added.
Today, Matang Group owns a 1,096ha oil palm plantation estate that spans across Segamat and Ledang District in Johor. It also owns a 1.3ha leasehold industrial land with three units of detached buildings in Kawasan Perindustrian Larkin in Johor Baru as well as about 5,016 sq m of freehold land in Tangkak, Ledang District, Johor.
“The listing (of Matang shares) will enhance the company’s profile and enable us to tap into the equity capital market to raise funds as well as to provide us the financial flexibility to implement our strategy to carry out replanting exercises for long-term sustainability and growth,” Matang chairman Datuk Teh Kean Ming said.
Proceeds from the IPO will be used primarily for general working capital requirements particularly for Matang Group’s day-to-day operations as well as for the purchase of fertilisers.
Part of the proceeds will also be used for replanting exercises to improve the overall age profile of the oil palm trees in Matang Estate, as well as for capital expenditure to enhance effectiveness in operations and to defray listing expenses.
M&A Securities managing director of corporate finance Datuk Bill Tan said the listing will provide the shareholders the opportunities to partake in the future growth potential of a new local plantation business.
“The listing will undoubtedly put Matang in a favourable position to capture future growth opportunities in the plantation industry in Malaysia. Furthermore, the upward trend of crude palm oil price from a low of about US$480 per tonne in September last year may offer a good chance for top line growth for the company,” Tan added.
Crude palm oil is currently traded at over US$650 (RM2,899) per tonne.