KTI aims to raise RM48mil from IPO for working capital, land acquisition


From left: KTI Landmark executive director Wilson Loke, promoter and substantial shareholder Chin Mee Leen, managing director/CEO Gordon Loke, Chief Minister of Sabah Datuk Seri Panglima Haji Hajiji Haji Noor, KTI Landmark chairman Datuk Haji Hamzah Haji Ghazalli, M&A Equity Holdings Bhd managing director Datuk Bill Tan, M&A Securities Sdn Bhd head of corporate finance Gary Ting

KUALA LUMPUR: KTI Landmark Bhd expects to raise RM48mil en route to a listing on the ACE Market of Bursa Malaysia on June 19, 2024.

In a statement, the Sabah-based integrated property developer said it plans to use RM20.7mil of the proceeds raised from the initial public offering (IPO) to supplement its general working capital requirements for The Logg's project.

This would include construction costs (building and infrastructure cost), consultants’ and professional fees, and local authority fees for the on-going projects.

The Logg is the company’s first mixed-development project and is also KTI’s first joint development project with Lembaga Pembangunan Perumahan dan Bandar (LPPB), the state agency in Sabah.

“The landmark property with an estimated gross development value (GDV) of about RM1bil to be developed on a five-acre land in Luyang, Sabah, by December 2025, comprising two blocks of condominiums, one block of apartment, a four-star hotel and a commercial building.

“The allocation of proceeds for our working capital requirements will reduce our dependency on external financing and allow us to undertake more projects concurrently,” said group managing director Gordon Loke.

A further RM18mil of the proceeds will be used to partly fund the RM74mil acquisition of landbank in Sabah within the vicinity of its existing landbank for a future project in Alamesra, Kota Kinabalu.

The land, measuring 26.3 acres will be developed into high rise residential properties in multiple phases until 2028, with an estimated GDV of about RM873.1mil.

The remainder of the proceeds will be used to purchase the new industrialised building system (IBS) production line amounting to RM2.1mil, RM400,000 to upgrade software and systems, RM3mil to repay bank borrowings while the remaining RM3.8mil will go to estimated listing expenses.

Under the listing exercise, KTI is issuing 160 million new shares and an offer for sale of 45 million existing shares, representing 20% and 5.6% of its enlarged share capital respectively, at an issue price of 30 sen per share.

Of the 160 million new shares, 40 million new shares will be available to the Malaysian public via balloting; 40 million new shares for its eligible directors, employees and persons who have contributed to the success of KTI Group under pink form allocations while the remaining 80 million new shares are reserved for private placement to Bumiputera investors approved by the Ministry of Investment, Trade and Industry (Miti).

As for the offer for sale, 20 million shares are reserved for private placement to Bumiputera investors approved by Miti while the remaining 25 million shares will be allocated by way of private placement to selected investors.

Based on the enlarged share capital of 800 million shares, KTI is expected to have a market capitalisation of RM240mil.

The IPO is open for subscription till June 4, 2024.

M&A Securities Sdn Bhd is the adviser, sponsor, underwriter and placement agent for the IPO exercise.

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