Flexidynamic to raise RM15m from IPO

KUALA LUMPUR: ACE Market-bound Flexidynamic Holdings Bhd is expecting to raise about RM15.05 million from its initial public offering (IPO).

The IPO involves a public issue of 75.231 million shares at the issue price of RM0.20 per share, of which 14.195 million shares will be made available to the Malaysian public via public balloting.

For eligible employees and persons who have contributed to the success of the company, 4.258 million shares will be set aside, while the remaining 56.778 million shares will be offered via private placement to selected investors.

General manager Ben Sin said RM6.38 million from the IPO will be allocated to repay bank borrowings drawn to fund the acquisition of new factories and RM0.42 million for the renovation of new factories.

"Some RM1.63 million will be used for the purchase of machinery and equipment, while RM3.62 million will be allocated for working capital.

"The remaining RM3 million will be utilised to defray estimated listing expenses, ” he told reporters after the virtual launch of the company’s prospectus today.

Sin said Flexidynamic, which is principally involved in the design, engineering, installation and commissioning of glove chlorination systems and has an existing order book of RM84.6 million, is scheduled to list on the ACE Market on March 30.

The company plans to move to the Main Market when the time is right.

Of the RM84.6 million order book, sales of RM67 million have been targeted in the current financial year and the remainder would be recognised for next year.

"Given the increased awareness from the COVID-19 pandemic, our outlook is expected to be positive," he noted.

Meanwhile, Flexidynamic managing director Tan Kong Leong said the company expects the demand for rubber gloves to continue to be high for the foreseeable future due to heightened awareness of how protective gear can help curb the spread of COVID-19.

Hence, the company plans to use part of the IPO proceeds to expand its current manufacturing capacity in Banting, he added.

"We will be taking vacant possession of two factories adjacent to our current factory that is currently being renovated.

"These new factories will be used to carry out in-house manufacturing works for the parts and components of our online glove chlorination systems that we currently outsource to our subcontractors, ” he said, adding that the new factories would start operations in the third quarter of this year. - Bernama

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