ACE Market-bound Master Tec aims to raise RM61.66mil from IPO

PETALING JAYA: Master Tec Group Bhd, en route for a listing on the ACE Market of Bursa Malaysia on Jan 29, 2024, expects to raise RM61.66 million from its initial public offering (IPO).

In a statement today, Master Tec said the IPO entailed the public offering of 285.6 million ordinary shares, comprising a public issue of 158.1 million new shares and an offer for sale of 127.5 million existing shares, representing 28.0 per cent of the group’s enlarged issued share capital of 1.02 billion ordinary shares.

Based on the IPO price of RM0.39 per share and its enlarged issued shares of 1.02 billion shares, Master Tec’s market capitalisation upon listing will be RM397.8 million.

It said RM16.78 million, or 27.22 per cent of the proceeds, would be used for the construction of two new medium voltage (MV) power cable manufacturing plants in Alor Gajah, Melaka, while RM24.39 million, or 39.55 per cent, to purchase new machinery and equipment.

“RM16.29 million, or 26.42 per cent, had been budgeted for general working capital, and RM4.20 million, or 6.81 per cent, would be reserved for listing-related expenses,” it said.

Of the 158.1 million new ordinary shares in Master Tec, 51 million shares are available for application by the Malaysian public, 2.14 million shares are available for application by eligible directors and employees of the group and 104.96 million shares by way of private placement to selected investors.

There would also be an offer for the sale of 127.5 million existing ordinary shares in Master Tec by way of private placement to identified Bumiputera investors approved by the Ministry of Investment, Trade and Industry (MITI).

Master Tec chief executive officer Tee Kok Hwa said the company aimed to expand annual production capacity by 3,600 tonnes per year for MV power cables and 9,500 tonnes of copper-cored and aluminium-cored wires and cables per year.

“We target to commence the newly added production of MV power cables by the fourth quarter of 2024.

“With the commencement of our new factories and increase in production capacity, we will be positioned to serve a wider range of customers, which we are confident will translate into delivery of better financial performance for the company,” he said in his keynote address during the launching ceremony of the IPO prospectus here today.

Master Tec has been primarily involved in the manufacturing and distribution of a wide range of safe, quality and high-performance low-voltage power cables, control and instrumentation cables and solar direct current power cables under Mastertec trademark since 2009.

The group is also involved in the trading and distribution of a wide range of MV power cables and fibre optic cables to cater to various end-user markets.

Based on the IPO prospectus dated Dec 28, 2023, the group registered slightly lower revenue of RM138.04 million, a decrease of approximately 19 per cent year-on-year, for the 6-month financial period ended June 30, 2023, compared to RM169.71 million registered in the same period last year.

SJ Securities Sdn Bhd is Master Tec’s principal adviser, sponsor, sole underwriter and sole placement agent for the group’s listing.- BK