Kawan Renergy’s IPO oversubscribed by 94.99 times

KUALA LUMPUR: Kawan Renergy Bhd’s initial public offering (IPO) has been oversubscribed by 94.99 times.

The engineering-solutions provider, which is slated to list on the ACE Market of Bursa Malaysia on May 29, stated the 19.3 million shares made available for application by eligible persons was also fully subscribed.

The company’s products are used for a wide range of industries such as food processing, oleochemicals, and chemical processing, oil and gas, waste recovery, power plant and utilities.

Kawan Renergy’s IPO involves an offer of 144.5 million ordinary shares, including 110 million new shares representing 20% of the enlarged share capital and an offer for sale of 34.5 million existing shares, or 6.3% of its enlarged share capital, by way of private placement to selected investors.

With an issue price of 30 sen per share, Kawan Renergy is expected to raise RM33mil from its public issue.

Upon listing, Kawan Renergy will have a market capitalisation of RM165mil based on the issue price of 30 sen per share and the enlarged share capital of 550 million shares.

A total of RM15mil or 45.5% of the proceeds raised will be allocated for working capital to undertake more co-generation plant projects.

Another RM7.5mil or 22.7% will be allocated for the investment of a new two Megawatt power plant and output improvements for its Bercham plant.

The group recently expanded into power generation and the sale of electricity.