PETALING JAYA: Stratus Global Holdings Bhd, which will soon go public on the Main Market of Bursa Malaysia, will channel the bulk of the RM285mil it aims to raise from its initial public offering (IPO) towards expanding its manufacturing capacity.
The Penang-based automated material handling system (AMHS) solutions provider has allocated RM122.6mil from the IPO proceeds to establish a new manufacturing facility that will substantially increase its production capacity and support larger, more complex semiconductor projects.
Its chief executive officer Ryo Narisawa said the expansion would increase the group’s manufacturing floor space to about 300,000 sq ft from the current 117,000 sq ft.
“We would like to more-than-double our capacity. This is an increase of about 150% or 2.5 times of our capacity and an up to four to five times increase in the actual capacity based on our estimations,” he said at after the company’s prospectus launch.
The enlarged facility is expected to strengthen Stratus Global’s ability to undertake larger-scale AMHS projects for semiconductor manufacturers, as customers continue expanding production to meet rising global chip demand.
Ryo said industry fundamentals remain highly favourable, particularly with the rapid adoption of artificial intelligence (AI), which has accelerated investments throughout the semiconductor value chain.
“The industry outlook is very good. The overall future for the semiconductor sector is great as AI-based chips are growing phenomenally,” he said.
Ryo noted the surge in AI chip demand is no longer confined to leading semiconductor manufacturers but has also filtered down to second-tier industry players.
“Two years ago they were operating at 70% to 80% capacity but many of them are operating at 100% now.
“This is likely to continue and would encourage more investments into new factories or expanding existing facilities. Based on this, we may record phenomenal growth,” he said.
Apart from expanding manufacturing capacity, Stratus Global intends to strengthen its international footprint by establishing sales and engineering support offices closer to customers in key semiconductor markets.
The company has allocated RM20mil from the IPO proceeds for overseas expansion, with offices planned in Germany, Japan, Taiwan and the United States.
Ryo said the initiative was driven by growing demand from existing multinational customers for faster technical support and closer engagement.
“Our existing customers have requested us to have a local office in our export markets so we could provide immediate services in case issues arise,” he said.
He added that each overseas office is expected to require approximately RM5mil in capital expenditure and will be staffed by sales engineers responsible for supporting customers and identifying new business opportunities.
Meanwhile, Stratus Global will allocate RM45mil for research and development (R&D) to enhance its AMHS solutions, proprietary transport control software and product innovation capabilities.
Another RM82.4mil will be utilised for working capital to support day-to-day operations and project execution, while RM15mil has been earmarked for listing expenses.
The IPO comprises an issuance of 356.25 million new shares at an issue price of 80 sen each, raising RM285mil and implying a market capitalisation of RM1bil based on an enlarged share base of 1.25 billion shares. No existing shareholders are selling their stakes under the exercise.
Applications for the IPO opened yesterday and will close at 5pm on July 10. The company is scheduled to debut on July 21.
