Johor Plantations seeks July 9 Main Market listing, largest IPO year-to-date

KUALA LUMPUR: Johor state-owned Johor Plantations Group Bhd looks to debut on the Main Market on July 9 as the largest initial public offering (IPO) year-to-date.

With an issue price of 84 sen per share, the upstream oil palm player expects to raise RM735mil in total proceeds.

Upon listing, Johor Plantations is expected to have a market capitalisation of RM2.1bil. The company launched its IPO prospectus on Wednesday.

Under the IPO exercise, about RM389.8mil will be raised via a public issue of 464 million new ordinary shares, while approximately RM345.2mil will be raised via an offer for sale of 411 million existing shares.

About 50.5% of the total proceeds to be raised from the public issue have been earmarked for the construction of an integrated sustainable palm oil complex and replanting activities.

Meanwhile, 43% will be channelled towards the repayment of bank borrowings and 1.7% will be for working capital, while the remaining proceeds will be utilised for listing related expenses.

In a statement, Johor Plantations said several cornerstone investors already on board, namely, abrdn Islamic Malaysia Sdn Bhd, abrdn Malaysia Sdn Bhd, AHAM Asset Management Bhd, AIIMAN Asset Management Sdn Bhd, Areca Capital Sdn Bhd, Fortress Capital Asset Management (M) Sdn Bhd and Retirement Fund Inc.

These investors made up about 37.2% of the total 875 million IPO shares.

Johor Plantations also announced its dividend policy to distribute at least 50% of its annual audited profit after tax attributable to its shareholders.

Managing director Mohd Faris Adli Shukery said the company has several initiatives in the pipeline designed to increase its competitiveness, focusing on increasing our crude palm oil production and expanding through downstream ventures.

“We intend to diversify to meet our future growth aspirations by becoming a fully integrated palm oil producer through our venture into the downstream segment, which focuses on specialty oils and fats.

“The IPO is a strategic move that will unlock our full potential and deliver long-term value to our stakeholders.”

Established in 1978, Johor Plantations is a wholly-owned subsidiary of Kulim (Malaysia) Bhd, which in turn is a wholly-owned subsidiary of Johor Corp.