K-Star launches IPO prospectus

  • Business
  • Wednesday, 12 May 2010

KUALA LUMPUR: K-Star Sports Ltd, which will be the fourth China company to be listed on the Main Market of Bursa Malaysia launched the prospectus for its initial public offering (IPO) yesterday.

Its executive director and chief financial officer, Lim Yeow Eng, said under the IPO, K-Star will offer 15.32 million new shares at an issue price of RM2.15 per share with 3.4 million shares allocated for the Malaysian public and the rest for selected investors.

The IPO exercise is expected to raise RM32.94mil out of which RM9mil will be used for raising the company’s production capacity, RM5mil for sales and marketing network expansion, RM4.5mil to enhance product design and development capabilities, RM3mil on branding and advertising efforts and the rest for working capital and listing expenses.

The company, scheduled for listing this May 31, recorded a revenue of Renmimbi570mil and a pre-tax profit of Renmimbi88mil last year.

“Proceeds raised from the IPO will enable us to keep up with the growing demand for our apparel, to keep abreast with the highly competitive industry and to continue enhancing our product design capabilities,” Lim said. “We’re very optimistic as our products cater to consumers in China, Asia and most Eastern European countries.”

Asked on why they opted for Malaysia, Lim said: “Malaysia and China have very close ties, that’s the reason we came here to invest. We are totally aware that Malaysia is welcoming foreign investors, (and) that is a good reason for us to come,” he told reporters at the launch of the prospectus.

“We do recognise there is a market for us and we are coming in the right time,” he added.

K-Star has been in the apparel industry for twenty years and its product range include athletic footwear and leisure wear.

They are also the original design manufacturer (ODM) and original equipment manufacturer (OEM) for international brands including Umbro, Diadora, Kappa, Le Coq Sportif, Die Wilden Kerle, Canguro Cosby and Bridgestones, as well as PRC footwear brand, Double Star.

It has four production lines and produces four million pairs of shoes in-house annually.

So far, three China-based companies have been listed on Bursa Malaysia.

They are Multi Sports Holdings Ltd, Xidelang Holdings Ltd and Xingquan International Sports Holdings Ltd which were listed last year. — Bernama

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