ACE Market bound Sin Kung targets RM26mil in proceeds from IPO
ACE Market bound Sin Kung targets RM26mil in proceeds from IPO

ACE Market-bound Sin-Kung targets RM26mil in proceeds from IPO

KUALA LUMPUR: Sin-Kung Logistics Bhd aims to raise RM26mil from its initial public offering (IPO) en route to a listing on the ACE Market of Bursa Malaysia.

In a statement, the integrated logistics service provider said it will utilise RM10mil of the IPO proceeds to fund its warehousing and distribution services’ expansion to meet the future rising demand from manufacturing and e-commerce sectors.

A further RM2mil of the proceeds will be used to purchase 100 commercial vehicles by 2025, as part of its strategy to further expand its trucking and container haulage businesses.

The remainder of the proceeds will be used to repay bank borrowings amounting to RM9.6mil and working capital of RM1.1 mil, as well as defray the estimated listing expenses of RM3.3mil.

Managing director Alan Ong said the anticipated growth of the electrical and electronics (E&E) industry and the exports of E&E products will not only drive the logistics and warehousing industry as a whole, but will particularly benefit the air freight industry as E&E products are generally high-value items and commonly transported through air freight.

This will in turn create demand for trucking services, including airport-to-airport road feeder services and point-to-point trucking services, to facilitate the movement of E&E products between and to/from airports, he added.

“We are already preparing for the future with the acquisition of our Valdor Office and Warehouse that will add an additional annual capacity of 192,000 pallets, to cater to our customers in the northern region of Peninsular Malaysia when operations begin by the end of 2026.

“The Valdor Warehouse is a built-to-suit warehouse. The acquisition will provide us with more storage space in addition to our existing five warehouses to serve more and larger orders from both our existing customers and potential customers, which will lead us to an increase in revenue of our warehousing and distribution services moving forward,” said Ong.

The IPO is open for subscription until May 2, 2024.

Sin-Kung Logistics’ listing on the ACE Market of Bursa Securities is tentatively scheduled for May 15, 2024.

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

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