TECHSTORE EYES RM25 MLN FROM IPO TO DRIVE EXPANSION

KUALA LUMPUR, Jan 22 (Bernama) -- Enterprise IT services provider TechStore Bhd aims to raise RM25 million from its initial public offering (IPO) en route to an ACE Market listing on Feb 18, 2025.

Its managing director Eugene Tan Hock Lim said that after being established for almost 14 years, the company plans to expand with the IPO proceeds.

“We have a lot of good reasons to expand such as setting up a branch, hiring more people and investing in machinery. So, these are what we're gonna do because with hard work we can achieve good results,” he said at a press conference following the launch of the company’s prospectus here today.

According to the prospectus, out of the RM25 million in proceeds, RM11.5 million will be allocated for working capital to support future projects and employee-related costs, RM5.0 million for the repayment of bank borrowings, and RM2.7 million for the recruitment of business development personnel.

Meanwhile, RM2.3 million will be allocated for capital expenditure on equipment, computers, hardware, information technology (IT) software, and the establishment of a new branch office in Johor Bahru, while the remaining RM3.5 million will be used for estimated listing expenses.

Tan said in a statement that the company specialises in the enterprise IT services industry, particularly within the transportation sector. 

“Our involvement in two out of the three LRT lines in the Klang Valley, contribution to the first MRT line in Malaysia, and participation in the Singapore-Malaysia RTS Link project have paved the way for future project opportunities.

“As we take the next step, we believe the IPO proceeds will serve as a catalyst to strengthen our market presence and drive future expansion,” he said.

TechStore said it will have a market capitalisation of RM100 million upon listing based on an enlarged issued share capital of 500 million shares and an IPO price of 20 sen per share.

“The group’s IPO exercise comprises the issuance of 125 million new ordinary shares in TechStore, constituting 25 per cent of the group’s enlarged share capital.

“Additionally, a private placement will be conducted for the offer for sale of 25 million existing shares, equivalent to 5 per cent of the enlarged shares,” the company said.

Out of the 125 million new shares, 25 million shares will be made available to the Malaysian public via balloting, 25 million shares to its eligible directors, employees and persons who have contributed to the success of TechStore.

Meanwhile, another 62.5 million shares will be offered by way of private placement to bumiputera investors approved by the Ministry of Investment, Trade and Industry while the remaining 12.5 million shares will be offered by way of private placement to selected investors. 

As of Dec 31, 2024, the group has 11 ongoing projects, an unbilled order book of RM104.7 million, and a tender book of RM647.2 million.

Applications for the IPO have commenced today and will close on Feb 4, 2025 at 5 pm.

M&A Securities Sdn Bhd serves as the principal adviser, sponsor, underwriter and placement agent for the IPO exercise.

-- BERNAMA