PETALING JAYA: Spring Art Holdings Bhd is targeting to raise RM24.42 million from its initial public offering (IPO) on the ACE Market of Bursa Malaysia.
The ready-to-assemble furniture products designer and manufacturer said in a statement that it plans to use RM17.55 million (71.9%) raised to acquire new machinery to set up two additional production lines for its new manufacturing factory namely Factory C.
It will also utilise RM3.67 million (15.0%) for general working capital requirements while the remaining RM3.20 million (13.1%) to be used to defray listing expenses for the IPO.
“We plan to construct Factory C, with a total estimated factory built-up area of approximately 103,926 sq ft to undertake the manufacturing of office furniture, bedroom furniture, living room furniture and other furniture for export to North America and Europe and for our existing customers,” said managing director Jack Lim Kok Eng.
Factory C is expected to commence operations in July 2022 and will increase Spring Art’s annual capacity to reach a combined manufacturing capacity of about 674,000 units per annum.
As at September 17, its total annual production capacity stood at 337,016 units.
Spring Art’s IPO entails the issuance of 97.69 million new shares representing about 23.5% of its enlarged share capital. Some 20.78 million shares will be made available to the Malaysian public via balloting; 4.16 million shares for its eligible directors and employees as well as persons who have contributed to the success of the group; while the remaining 72.75 million shares for private placement to selected Bumiputera investors approved by Ministry of International Trade and Industry Malaysia and selected investors.
Its existing shareholders of the Company will also make an offer for sale of 27.02 million shares by way of private placement to selected investors.
Based on the enlarged share capital of 415.69 million shares, Spring Art is expected to have a market capitalisation of RM103.92 million. Its listing is tentatively scheduled on November 8, 2019.
