Eversafe Rubber to raise RM17m in IPO

KUALA LUMPUR: Eversafe Rubber Bhd, which is en route to a listing on the ACE Market of Bursa Malaysia Securities Bhd, intends to raise RM17.28 million in its initial public offering (IPO).

Eversafe is involved in the development, manufacturing and distribution of tyre retreading materials and tyre retreading operations.

Based on the issue price of 36 sen per share and the enlarged issued and paidup share capital of Eversafe, the company will have a market capitalisation of RM86.61 million.

The proceeds raised will be used for new manufacturing lines and enhanced automation system (72.8%), establish intellectual property rights and overseas branding initiative (8.7%), as well as defrayment of listing expenses (18.5%).

Eversafe CEO Cheah Siang Tee said it plans to increase its revenue from the overseas market to 75% in three years, from 57.1% in FY16. The company has been able to grow export sales with exports to at least 23 countries including New Zealand, Japan and Australia.

To date, Eversafe has eight facilities including four in Ipoh comprising manufacturing plants, warehouse and head office; two facilities comprising a manufacturing plant and warehouse in Penang, an administration office in Shanghai and one manufacturing facility cum office in Jiaxing, China.

It is finalising details of a joint venture arrangement to establish a tyre retreading plant in South America. The plant, which is expected to start operations next year, will be used for training and demonstration to promote its products to capture the tyre retreading business in South America.

The IPO exercise entails up to 78 million of shares comprising 48 million issue shares and 30 million offer shares while 12.5 million shares will be allocated to the public.