KUALA LUMPUR: Food and beverage and supplement company OB Holdings Bhd plans to raise RM28.80 million through its initial public offering (IPO) upon listing on Bursa Malaysia's ACE Market on October 29, 2024.
This will be through the issuance of 120.00 million, representing 30.64 per cent of its enlarged issued share capital.
Of the total proceeds, RM14.90 million will be used to repay bank borrowings incurred from the construction of the new Serendah Factory.
A total of RM5.00 million is earmarked for the purchase of new machines, while RM0.90 million will be used to set up a new laboratory in the new Serendah Factory and undertake the clinical trial for the Bonlife SachaQ10 Plus Softgel.
The remaining funds will be used for general operational purposes, including RM1.00 million for marketing and advertising activities, RM3.00 million for working capital, and RM4.00 million to cover IPO-related expenses.
Managing director Teoh Eng Sia said the upcoming IPO comes at an opportune time, coinciding with a growing demand for fortified food and beverages (F&B) and dietary supplements.
Teoh said to capitalise on the growing demand for fortified F&B and dietary supplements, the company plans to improve its manufacturing efficiency by constructing a new Serendah Factory.
"This move will enable us to optimise our manufacturing workflow and position us to cater to the increasing demand for our products and services. In addition to the new factory, we will purchase new machines and establish a new laboratory to expand production, introduce new products, and enhance our research capabilities. "We will also conduct a clinical trial for Bonlife SachaQ10 Plus Softgel to enhance consumers' confidence by providing third party verification of our product's efficacy and strengthen our brand reputation as a provider of scientifically-driven nutrition," he said.
With an enlarged issued share capital of 391.62 million Shares and an IPO price of 24sen per share, OB Holdings will have a market capitalisation of RM93.99 million upon listing. Alliance Islamic Bank is the principal adviser, sponsor, sole underwriter andplacement agent for the IPO exercise.