The manufacturer and trader of steel products, Leform has entered into an underwriting agreement with MIDF Investment in conjunction with its forthcoming initial public offering (IPO) on the ACE Market of Bursa Securities.
The group is scheduled to be listed on the ACE Market of Bursa Securities by November 2022.
Leform’s IPO exercise encompasses a public issuance of 311.0 million new shares, representing 21.0% of its enlarged share capital, as well as an offer for sale of 74.1 million existing shares, representing 5.0% of the enlarged shares by way of private placement to identified institutional and/or selected investors.
Out of the 311.0 million new shares, 74.1 million shares will be made available to the Malaysian public via balloting; 29.6 million shares are pink form allocations, which are to its eligible directors, employees, and persons who have contributed to the success of the Group; 22.2 million shares by way of private placement to selected investors; while the remaining portion of 185.1 million shares is reserved for Bumiputera investors approved by the Ministry of International Trade and Industry, which will be done via private placement as well.
To recap, Leform and its subsidiaries are principally involved in the manufacturing of and trading in steel products, particularly steel pipes, guardrails, and flat steel products. Supported by the Group’s wide range of steel product offerings, its products are catered to various end-user industries comprising furniture industry, construction industry as well as industrial product manufacturing industry (which includes automotive parts and telecommunication tower pole part manufacturing).
The Group also exports its products to international markets such as New Zealand, Singapore and Cambodia on top of its Malaysian market.
“This IPO exercise will expedite our expansion plans and allow us to tap into the equity capital market, granting us better financial flexibility to capitalise on future growth opportunities as they arise,” Managing Director of Leform Berhad, Mr. Law Kok Thye said.
“Against the backdrop of the prospects of the construction industry in light of emerging infrastructure projects and housing projects and government initiatives to drive demand for residential properties as well as rising demand for automotive vehicles and locally manufactured furniture, demand for steel products is expected to be stimulated alongside the growth of these end-user industries,” he elaborated.
“Therefore, we have strategised initiatives to construct new facilities to cater for the anticipated increase in orders for steel pipes and flat steel products. The expansion of our storage space capacity for example, will enable us to operate our machineries more efficiently. We will utilise a portion of the IPO proceeds to improve our working capital, equipping us with the ready capacity to scale up our operations and production output which will solidify our stature in the steel industry.” Mr. Law added.
“As the Principal Adviser, Sole Underwriter and Sole Placement Agent for this IPO exercise, we are delighted to be part of this notable milestone in Leform’s corporate journey. The listing status sought will certainly elevate the Group’s credentials and reputation, building upon a business model that has proven resilient through various economic environments. Now, as Leform forges ahead, we look forward to working together with the team from Leform – to grow the company from strength to strength as a player in the steel industry,” Chief Executive Officer of MIDF Investment, Datuk Dominic Silva said.
MIDF Investment is appointed as the Principal Adviser, Sponsor, Sole Underwriter, and Sole Placement Agent for the IPO exercise.
