KUALA LUMPUR: Leform Bhd has made its debut on the ACE Market of Bursa Malaysia Securities Bhd on Nov 30 at 19.5 sen per share, a discount of 3.5 sen from its initial public offering (IPO) price of 23 sen.
At the opening bell, 8.38 million of its shares were traded.
The steel manufacturer and trader has a market capitalisation of RM340.6 million, based on its enlarged share capital of 1.48 billion shares.
Speaking to reporters at the listing ceremony here, managing director Law Kok Thye said the group has been constrained by storage space.
“Therefore, a substantial amount of the proceeds is allocated towards solving that bottleneck, as the construction of new warehouse facility would boost our storage area and improve operational efficiency via the consolidation of delivery operations and adoption of a more systematic storage system,” he said.
He also said that proceeds from the listing would also assist in unlocking new revenue streams as the group reconfigures some of its pipe mills for greater product variety.
“Meanwhile, the increased working capital and new workers’ accommodation are needed to support the anticipated expansion,” said Law.
Meanwhile, group adviser and executive director Phang Yew Choong said the group will also look into the potential installation of solar panels in order to reduce its electricity usage and carbon footprint.
“Our corporate finance team will be looking into the cost-benefit ratio to ensure that our shareholders are well taken care of,” he said, adding that Leform plans to maintain its dividend policy of a payout ratio of not less than 20% of its annual audited net earnings.
Leform has raised RM71.5 million from its IPO, of which RM30 million will be used to construct a new headquarters, warehouse storage facilities and workers’ accommodation, RM21.9 million for working capital, RM14.4 million for repayment of bank borrowings and RM5.2 million for listing expenses. — Bernama
