Wentel Engineering inks underwriting agreement with TA Securities

From left: Wentel Engineering non-independent and non-executive chairman Ban Kim Wah, executive director Wong Chun Wei, TA Securities executive director of operations Tah Heong Beng and head of corporate finance Ku Mun Fong

KUALA LUMPUR: Wentel Engineering Holdings Bhd has signed an underwriting agreement with TA Securities Holdings Bhd for the company's initial public offering (IPO) on the ACE Market of Bursa Malaysia.

In a statement, Wentel said its IPO entailed a public issue of 273.2 million new shares and an offer for sale of 46 million existing shares.

TA Securities will underwrite 57.5 million of the public issue shares, representing the portion made available to the Malaysian public via balloting.

The public issue will also comprise of 33 million shares to be be allocated to eligible directors, employees and other persons who have contributed to the success of Wentel and its subsidiaries and 38.95 million shares for private placement to selected investors.

A remainder of 143.75 million public issue shares will be allocated to Bumiputera investors approved by the Ministry of Investment, Trade and Industry.

Wentel is principally involved in the fabrication of semifinished metal products, fabrication of metal parts and assembly of finished products for the manufacturers of several industries.

According to the group, proceeds from the IPO will be utilised to partly finance the construction of two blocks of single storey factory (with double storey office) and two blocks of workers’ hostel.

The group said the new manufacturing plant is expected to provide it with a net additional built-up area of about 254,381 sq ft for its operations and workers’ accommodation.

Wentel will also utilise the IPO proceeds to part finance the purchase of new machinery and equipment for the new manufacturing plant.

Wentel executive director Wong Chun Wei said: "Our focus is to establish the new manufacturing plant as well as purchase new machinery and equipment to address opportunities in Malaysia and Singapore targeting existing and new customers.

"Meanwhile we will continue to leverage on our core competencies and strengths in the fabrication of semifinished metal products, fabrication of metal parts and assembly of finished products to further grow our business moving forward”.