Prestar to list steel unit on ACE Market
PETALING JAYA: Prestar Resources Bhd is looking to list its subsidiary Tashin Steel Sdn Bhd on the ACE Market of Bursa Malaysia via a special purpose vehicle known as Tashin Holdings Bhd, by the fourth quarter this year.
The group told Bursa Malaysia that as part of the proposed listing exercise, Tashin Holdings has entered into a share sale agreement with Prestar and Formula Naga to acquire the entire share capital of Tashin Steel for RM144.07 million.
The acquisition would be satisfied by the issuance of new Tashin Holdings shares at an issue price of 50 sen per share.
Currently Prestar owns a 51% stake in Tashin Steel, which has a share capital of RM20 million, while the balance 49% held by Formula Naga Sdn Bhd.
Tashin Steel is involved in the processing of steel coils into slit coils and steel sheets as well as manufacture of steel products including expanded metals products, flat bars, square bars, steel pipes, steel plates, checkered plates and C Purlins.
Tashin Holdings’ initial public offering (IPO) exercise involves the issuance of 59.02 million new shares representing 17% of its enlarged share capital. Of the 59.02 million new shares, 17.36 million new shares will be made available to the Malaysian public via balloting.
Proceeds from the IPO will be used mainly for capital expenditure to support Tashin Group’s business expansion into the production of wire mesh products and to upgrade the existing steel processing line; to purchase a piece of industrial land for the construction of a new factory; to supplement the working capital of the Tashin Group which includes the purchase of raw materials.
M&A Securities is the principal adviser for the IPO exercise.
Post-listing of Tashin Steel, Prestar will continue to focus on its downstream manufacturing of material handling equipment such as racking for warehouses and third party logistic for e-commerce, wheelbarrows for palm oil plantation and guardrails for highway.
It will also expand its manufacturing capacity of carbon steel pipes and hollow sections for supplies to furniture, office equipment manufacturing, engineering and fabrication usage.