ACE Market candidate EMCC to expand pawnbroking ops

PETALING JAYA: Evergreen Max Cash Capital Bhd (EMCC) aims to raise RM64.2mil from its upcoming initial public offering (IPO) and listing on the ACE Market of Bursa Malaysia.

The proceeds will be used to expand its pawnbroking business, said group managing director Datuk Low Kok Chuan.

“To capitalise on the future demand for pawn loans, we seek to utilise RM30mil or 46.7% of the IPO proceeds towards funding the additional cash capital of our pawnbroking business.

“Another RM20mil or 31.1% of the proceeds will be used for opening up to five new ‘Pajaking’ pawnshops in Kuala Lumpur, Selangor and Pahang,” he said in a statement yesterday.

The remaining IPO proceeds of RM14.2mil (22.2%) will be used for repayment of bank borrowings and for the group’s working capital purposes and to defray listing expenses.

Low said the expansion plan would scale up its pawnbroking business and thereby capture a larger market share and brand visibility.

Apart from pawnbroking services, EMCC is a retailer and trader of gold and luxury products.

Established in 2012, the EMCC’s core pawnbroking business consists of a network of 22 “Pajaking” pawnshops in Kuala Lumpur, Selangor, Negri Sembilan and Pahang.

The group also offers pawnbroking consultancy and IT solution services to third-party pawnbrokers whom it has identified to be not in direct competition with its “Pajaking” pawnshops.

EMCC’s IPO will comprise a public issue of 267.6 million new ordinary shares or 24% of its enlarged issued shares and an offer for sale of 43 million existing shares or 3.9% of its enlarged issued shares to selected investors by way of placement.

Out of the 267.6 million new shares to be issued, 55.7 million will be made available for application by the public via balloting and 27.9 million shares for its eligible directors and employees as well as persons who contributed to the group’s success.

Another 44.6 million shares will be sold by way of placement to selected investors while the remaining 139.4 million shares are earmarked for selected bumiputra investors approved by the Investment, Trade and Industry Ministry.

Based on the IPO price of 24 sen per share and its enlarged issued shares of 1.11 billion, EMCC’s market capitalisation upon listing is RM267.6mil.

EMCC intends to distribute 20% of earnings as dividend. The group is scheduled to be listed on Sept 26.