KUALA LUMPUR: Yenher Holdings Bhd has plans to expand its sales to Myanmar, Bangladesh and China within 24 months after its listing on the Main Market on July 15.
“The three countries have huge populations and opportunities to improve livestock production,” said group managing director Cheng Mooh Tat in an online media briefing after the launch of Yenher’s initial public offering (IPO) prospectus.
Cheng added that the group would monitor the political situation in Myanmar before moving into its market.
The group is based in Seberang Prai Selatan, Penang and manufactures and distributes animal health and nutrition products, as well as provides value-added diagnostic and material analyses services. Its customers are mainly farmers, feed millers as well as livestock integrators operating in the poultry and swine subsectors.
For its financial year ended Dec 31, 2020 (FY20), about 90% of the group’s RM202.6mil revenue was from Malaysia, and the balance 10% from overseas markets.
Indonesia was the largest export sales contributor (RM8.66mil or 4.3% of revenue), folllowed by Brunei (RM7mil or 3.45%) with the balance coming from Hong Kong, Belgium, Pakistan, South Korea, Nigeria, Thailand, Vietnam, Singapore and Taiwan.
Regarding the current lockdown, Cheng said the group’s operations were in the essential services category. “Under the current lockdown, we are allowed to operate at 60% workforce capacity. We do not see any significant financial impact,” he said.
The IPO exercise will raise RM61.21mil, of which Yenher has earmarked RM31mil to build a new GMP (good manufacturing practices)-compliant plant, RM9.7mil to buy machinery and equipment for the new plant, RM16.71mil as working capital and the remaining RM3.8mil for listing expenses.
The new manufacturing plant is expected to commence testing and commissioning in the first quarter of 2023 and be fully operational in the fourth quarter of 2023.
“With the new manufacturing plant, we will be able to increase our production capacity and be ready to meet the higher demand for our products,” said Cheng.
The group has two plants in Seberang Prai Selatan. “The new plant will be about 10km from our current plants. It will have three production lines, which will provide better flexbility and improve efficiency,” he added.
Cheng also said the listing would further enhance the group’s profile and corporate image, increase its products’ brand awareness and widen its market reach.
Yenher’s IPO of 106.19 million shares is at an offer price of 95 sen per share. Upon listing, the market capitalisation of Yenher will be RM285mil based on the offer price. The IPO comprises a public issue of 64.43 million new shares and an offer for sale of up to 41.76 million existing shares.
The public issue, which is 21.48% of the enlarged issued share capital of Yenher, will be allocated as such – 15 million shares for application by the Malaysian public; 15 million shares for application by eligible directors, employees and persons who have contributed to the success of the group; and 34.43 million shares by way of private placement to bumiputra investors approved by the Ministry of International Trade and Industry (Miti).
The offer for sale of up to 41.76 million existing shares by the selling shareholders, which is 13.92% of the enlarged issued share capital, will be allocated as such – 3.07 million shares via private placement to bumiputra investors approved by Miti; and 38.69 million shares via private placement to other institutional and selected investors.
RHB Investment Bank Bhd is the sole principal adviser, sole underwriter and sole placement agent for the listing exercise.