KUALA LUMPUR: Kumpulan Kitacon Bhd is raising RM51.7 million from its initial public offering (IPO), in line with its proposed listing on the Main Market of Bursa Malaysia on Jan 17 next year.
Kitacon is a G7 building construction contractor involved in the construction of both residential and non-residential buildings, which include commercial, industrial, purpose-built and institutional buildings.
The RM51.7 million will be raised from a public issue of 76.09 million new shares at an issue price of 68 sen each.
Kitacon's IPO also involves an offer for sale of 62.5 million existing ordinary shares.
Managing director Tan Ah Kee said the company planned to broaden its reach and expertise in township construction as it aims to secure more contracts from new clients.
"Additionally, we will continuously explore and adopt progressive construction techniques such as the use of aluminium framework system to improve our productivity and deliver projects within the stipulated time, cost and highest quality standards.
"Today marks a momentous occasion for Kitacon and we foresee ourselves growing onwards and upwards as we inch closer to our listing," he said in a statement today.
Kitacon has earmarked 46.4 per cent of the IPO proceeds for the acquisition of construction equipment including aluminium formwork systems, scaffoldings and cabins.
Meanwhile, 38.7 per cent has been budgeted for the acquisition of land and construction of a storage and refurbishment facility while 6.3 per cent has been set aside for working capital.
The remaining proceeds will be utilised for the listing expenses.
Based on the enlarged issued share capital of 500 million shares and issue price of 68 per share, Kitacon will have a market capitalisation of RM340 million.
The company intends to declare a yearly dividend, equivalent to at least 25 per cent of its net profit attributable to its shareholders.
The public issue portion of the IPO will be made available from today and the application will close on Jan 9 at 5pm.
RHB Investment Bank Bhd is the principal adviser, sole underwriter and sole placement agent for the IPO.