KUALA LUMPUR: Retail technology solutions provider Radiant Globaltech Bhd, which is seeking to list on the Ace Market, plans to raise RM29.5mil from the sale of 128.1 million new shares at 23 sen each.
Of the 128.1 million new shares, it will offer 11.0 million shares to the public; 21.1 million shares to eligible directors and employees while the bulk of it, or 96 million shares will be placed out to selected investors.
As part of the IPO, the current shareholders will place out 12.0 million existing shares to selected investors.
Of the total IPO proceeds of RM29.5mil to be raised, Radiant Globaltech will utilise RM11.6 mil for business and capital expansion, RM3mil to expand its retail software business and RM4.8mil for working capital. It will use RM6.6mil to repay bank borrowings and the remaining RM3.5mil to defray the listing expenses.
The company issued its prospectus on Thursday and the closing date for the application of its shares will close on July 10. It hopes to list on July 24.
Alliance Investment Bank Bhd is the principal adviser, sponsor, sole underwriter, and placement agent for the IPO.
Radiant Globaltech’s managing director Paul Yap Ban Foo said that the group plans to extend regional footprint and raise funds to support its expansion plans.
He said the economic growth and rapid urbanisation in South East Asia has provided a conducive environment for the retail sector.
“The anticipated conversion from manual systems to automated retail technology solutions presents growth opportunities for us,” Yap said.
He said the group would be able to leverage on its experience in Vietnam and Cambodia to continue to expand in Asean, with near term focus on Indonesia’s booming retail market.”
“We also intend to aggressively pursue growth in our in-house retail software management solutions, namely AX Retail B2B Portal and AX Retail Consignment Portal, and leveraging on our large customer base of hardware customers to cross-sell our software products.
“We aim to enhance operational efficiency, facilitate seamless retail management processes, and enable efficiency and transparency within the supply chain of retail clientele,” said Yap, adding the group plans to set up a regional sales support team for its software products.
Radiant Group incorporated its Vietnam office in 2006 and Cambodia in 2013. It has secured sales from Parkson Vietnam, Aeon Vietnam, and Aeon Cambodia, amongst others.
The group’s Vietnam and Cambodia subsidiaries contributed RM10.6mil or 13.1% of revenue in the financial year ended Dec 31, 2017, compared with RM2.9mil in FY15.
Smith Zander estimated that Radiant Group has a 20% market share of Malaysia’s retail technology solutions industry worth RM404.2mil in 2017.
The retail technology solutions industry in Malaysia was RM404.2mil in 2017 and it is expected to record a compounded annual growth rate of 6.26% to RM456.4mil in 2019.
The growth will be underpinned by the retail industry, higher automation, and continuous technological advancements of the retail technology solutions sector.
For the FY2015 to FY2017, Radiant Group’s revenue increased from RM66.4mil to RM80.8 mil while net profit grew from RM6.3mil to RM7.1mil.
Among those present at the launch of the prospectus were Freddy Yap Sin Sang, Radiant Globaltech executive director; Tee Kok Wah, head of corporate finance - capital markets, Alliance Investment Bank; Paul Yap John Yap Poh Keong, Radiant Globaltech executive director and Radiant Globaltech independent non-executive director Mashitah Osman.