TSA Group aims to raise RM42.5mil in proceeds from IPO
Published on: Wednesday, December 27, 2023
By: Bernama
For the expansion plan, TSA Group is investing 12% of the proceeds into establishing its Semenyih manufacturing premises. (Facebook pic)
PETALING JAYA: ACE Market-bound TSA Group Bhd, set to debut on Feb 2, 2024, aims to raise RM42.53 million from its initial public offering (IPO).
The IPO entailed a public offering of 77.32 million new ordinary shares in TSA priced at 55 sen per share, making up 25% of the company’s expanded share base.
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Out of this, 15.46 million ordinary shares are expected to be open for application by the Malaysian public, another 15.46 million for eligible employees, 38.66 million via private placement to Bumiputera investors approved by the investment, trade, and industry ministry (Miti), and 7.73 million through private placement to selected investors.
Upon listing, the industrial hardware provider would have a market capitalisation of RM170.11 million.
Group managing director Chew Kuan Fah said 47% of the RM42.53 million IPO proceeds will be used to repay existing borrowings within five months of the listing.
“This move is a step towards solidifying our financial base, reducing debt, and minimising interest costs, thereby enhancing our financial resilience,” he said after launching the IPO prospectus today.
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Chew said another 29% is allocated towards strengthening its working capital over the next 36 months and improving operational efficiency.
For the expansion plan, he said the group is investing 12% of the proceeds into establishing its Semenyih manufacturing premises.
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“It is slated for use within 24 months post-listing and is a testament to our commitment to scaling our operations and enhancing market reach.
“Meanwhile, the remaining funds will cover the listing expenses,” he said.
Meanwhile, AmInvestment Bank Bhd CEO Tracy Chen said TSA’s transformation into a publicly-listed company will bolster its financial base and unlock new opportunities.
“The group’s wide market coverage and large customer base in Malaysia and Singapore, as well as their manufacturing capabilities, augurs well for its future,” she said.
AmInvestment is the appointed adviser, sponsor, underwriter, and placement agent for TSA’s IPO exercise.
TSA is known as a distributor and supplier of ferrous and non-ferrous metal and other industrial hardware products as well as a manufacturer and processor of stainless steel pipes and other metal products, with its main markets in Malaysia and Singapore.
TSA has also exported its products to international markets such as Australia, Bangladesh, Brazil, Brunei, China, France, India, Indonesia, Kazakhstan, Maldives, Myanmar, New Zealand, Saint Lucia, Sri Lanka, Thailand and the UK.
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