Leong Hup to utilise IPO proceeds to repay bank borrowings

PETALING JAYA: Poultry company Leong Hup International Bhd, which is seeking to relist its shares on Bursa Malaysia’s Main Market, aims to utilise the bulk of the proceeds that it intends to raise at its initial public offering (IPO) to repay bank borrowings.

According to its prospectus exposure on the Securities Commission website, the group’s total borrowings, excluding finance lease liabilities, amounted to RM2.11bil at the latest practicable date.

Leong Hup said about 63.29% of the proceeds would be to repay borrowings, followed by 29.17% which would be utilised for capital expenditure.

Leong Hup’s IPO will involve the issuance of up to 1.6 billion shares, representing 40% of its enlarged issued and paid-up capital.

Of the 1.6 billion shares, up to 1.495 billion shares (or 37.38% of its enlarged issued and paid-up share capital) will be allocated to institutional investors, whereby 1.03 billion shares will be allocated to Malaysian institutional and selected investors as well as foreign institutional and selected investors.

The remaining 460 million shares will be allocated to bumiputera institutional investors and selected investors approved by the international trade and industry ministry.

Leong Hup’s main business activities include the breeding, rearing, slaughtering, processing and retailing of chickens and eggs.