Advancecon to raise RM57mil from Main Market listing – Business News

KUALA LUMPUR: Advancecon Holdings Bhd will raise some RM56.7mil from its listing on the Main Market of Bursa Malaysia on July 10.

The earthworks and civil engineering services company, which had recently undertaken such works for two major projects – the West Coast Expressway (WCE) and the Pan Borneo Highway – needs to raise funds to purchase new construction equipment and machinery such as excavators, motor graders and tipper trucks.

Some RM29.7mil from the amount raised will be utilised for this purpose and another RM14.6mil for the construction of a new workshop for in-house maintenance, modification and repairs of the group’s machinery fleet.

“Our contract wins for the provision of earthworks and civil engineering services for the WCE and Pan Borneo Highway solidify our position as one of the industry players that is able to undertake such large-scale projects,” said group CEO Datuk Phum Ang Kia in a statement.

He said the company is optimistic on its prospects and the raising of funds through the initial public offering (IPO) would help prepare its balance sheet for even bigger-scale projects.

The balance of RM10.7mil will be set aside for working capital, RM12.5mil for the repayment of bank borrowings and RM3.8mil for listing expenses.

The listing will entail a public issuance of 90 million new shares at an issue price of 63 sen per share that represents 22.4% of Advancecon’s enlarged share capital. The new shares will see 37 million shares being allocated for private placement to institutional and identified investors; 18 million shares for private placement to identified bumiputra investors approved by the International Trade and Industry Ministry (Miti); five million shares to eligible directors and employees of the group; and 30 million shares for application by way of balloting to the Malaysian public.

The IPO would also see an offer-for-sale of 33 million existing shares allocated for private placement to identified investors approved by Miti. The company has also undertaken earthworks and civil engineering works for notable projects around the country such as Bandar Setia Alam, Setia EcoHill, Setia Eco Gardens, Eco Majestic and Tropicana Aman.

The company has also carried out works for infrastructure projects in relation to the construction of highways such as the Trumpet Interchange and EcoHill Link that is connected to the Kajang-Seremban Highway. RHB Investment Bank Bhd is the principal adviser, underwriter and placement agent for the IPO exercise.

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