The Borneo Post
Flexidynamic a step closer to listing with signing of underwriting agreement
KUALA LUMPUR: Flexidynamic Holdings Bhd (Flexidynamic), sealed an underwriting agreement with M&A Securities Sdn Bhd ( M&A Securities) in conjunction with the company’s initial public offering (IPO) on the ACE Market of Bursa Malaysia Securities Bhd (Bursa Securities), following the approval granted by Bursa Securities for the company’s proposed IPO on November 12, 2020.
M&A Securities has been appointed as Flexidynamic’s Principal Adviser, Sponsor, Underwriter and Placement Agent for the IPO exercise. Pursuant to the Underwriting Agreement, M&A Securities will underwrite a total of 18,453,000 shares.
Flexidynamic, established in 2012, is involved in the design, engineering, installation, and commissioning of glove chlorination systems, as well as the design and installation of storage tanks and process tanks for the glove manufacturing industry.
Commenting on the business, Flexidynamic managing director Tan Kong Leong, said: “Our design and engineering expertise gives us the flexibility to provide customisation for our customers and allows us to design and offer glove chlorination systems that suit our customers’ glove manufacturing processes. It also fulfils our customers’ requirements on their glove chlorination process as well as enabling us to retain our customers and contribute to our business sustainability.”
He added, “We started small and over the last few years, we have expanded our products and services locally as well as regionally, including to Vietnam, Thailand, Indonesia and Sri Lanka.”
The company is targeting a prospectus launch in the first quarter of 2021 with an IPO comprising a total of 75.23 million new ordinary shares (shares). Of the 75.231 million new shares, 14.195 million shares will be made available to the Malaysian public via public balloting, 4.258 million shares will be set aside for eligible employees and persons who have contributed to the success of the company while the remaining 56.778 million shares will be offered via private placement to selected investors.
The IPO proceeds will be utilised to finance the acquisition of new factories as well as new machinery and equipment to be installed in the new factories. Part of the proceeds will be allocated for working capital mainly for the purchase of raw material used in manufacturing parts and components of glove chlorination systems, with the remaining proceeds to go to defraying the IPO listing expenses.
“We purchased two adjoining new semi-detached factory units with a total factory built-up area of 14,659.60 sq ft each in Banting. The factories are currently under construction and we expect to take vacant possession of both factories during 2021.
“Upon completion, the factories will be used to carry out in-house manufacturing works for the parts and components of our online glove chlorination systems that we currently outsource to our subcontractors. This will allow us to reduce our reliance on third parties,” Tan added.
Commenting on the IPO exercise, Datuk Bill Tan said, “The IPO will give Flexidynamic the opportunities to grow in its specialised industry. The company has a proven track record with customers in the glove manufacturing and glovedipping line industries. It is led by an experienced management team with operational expertise and in-depth knowledge of the glove chlorination industry in Malaysia.”
“The underwriting agreement is another step closer for Flexidynamic to the IPO, as the resources provided through the IPO proceeds will give us the opportunity to expand our business capabilities,” Tan added.