KUALA LUMPUR: SSF Home Group Bhd (SHG) signed an underwriting agreement with M&A Securities Sdn Bhd for its initial public offering (IPO) on the ACE Market of Bursa Malaysia.
Managing director and chief executive officer Wong Choong Loong said this IPO exercise brings multifaceted benefits beyond the expected proceeds to be raised.
He said the listing status would enhance SHG's stature among customers and suppliers, strengthening the company's reputation and opening new avenues for growth.
SHG's IPO exercise involves a public issue of 200.0 million new shares, representing 25.0 per cent of its share capital, and an offer for sale of 24.0 million existing shares, representing 3.0 per cent, through private placement to selected investors.
Out of the 200.0 million new shares, 40.0 million will be made available to the Malaysian public via balloting and 40.0 million shares to its eligible directors, employees, and persons who have contributed to the success of SHG.
Further, a total of 20.0 million shares will be offered as a private placement to selected investors, while the remaining portion of 100.0 million shares is reserved for Bumiputera investors approved by the Ministry of Investment, Trade and Industry (MITI), which will also be done via private placement.
M&A Securities will underwrite 80.0 million new shares made available to the Malaysian public, SHG employees, and directors.
SHG, through its subsidiaries, is involved in retailing furniture, home décor and home living products via retail outlets and e-commerce website.
The company offers a comprehensive range of furniture, home décor and home living products for various applications and settings.
SHG has developed a network of 41 retail outlets strategically located in shopping malls, shoplots, and standalone outlets in commercial areas throughout Peninsular Malaysia, Sabah and Sarawak.
Notably, the central region, comprising Selangor and Wilayah Persekutuan, accounted for the largest contribution to SHG's revenue of 41.5 per cent in the financial year ending April 30, 2022.
Wong said the Malaysian home furnishing retail industry is poised to grow, driven by various favourable factors.
These include higher spending on home furnishings, rising population and urbanisation as more people live in cities and have larger incomes, and proactive government support for affordable housing initiatives.
In addition, he said the continuous influx of new shopping malls across the country presents opportunities for retailers to expand their reach and cater to a broader customer base.
At SHG, we are committed to capitalising on these favourable market conditions and maintaining our position at the forefront of the home furnishing retail industry.
"Moving forward, most of our IPO proceeds will be allocated to setting up new retail outlets throughout Malaysia. This strategic move aims to strengthen our brand visibility and attract a larger customer base," Wong said.
SHG is scheduled to be listed on the ACE Market of Bursa Malaysia by October 2023, with M&A Securities as the adviser, sponsor, underwriter and placement agent for the IPO exercise.