PETALING JAYA: Khazanah Nasional Bhd-backed Farm Fresh Bhd is looking to be listed on the Main Market of Bursa Malaysia in the first quarter of this year in what is expected to be one of the largest initial public offerings (IPOs) of the year.
The dairy producer signed an underwriting agreement with CIMB Investment Bank Bhd, Maybank Investment Bank Bhd, Affin Hwang Investment Bank Bhd, AmInvestment Bank Bhd, Hong Leong Investment Bank Bhd and RHB Investment Bank Bhd yesterday in conjunction with its IPO.
The IPO, of up to 743.2 million shares in Farm Fresh, comprises an offer for sale of up to 520.2 million existing shares and a public issue of 223 million new shares.
The 743.2 million IPO shares consist of an institutional offering of up to 687.4 million shares, representing up to 37% of the group’s enlarged share capital, and a retail offering of 55.7 million shares or 3% of the enlarged share capital.
Last week, a Bloomberg report citing people familiar with the matter said Farm Fresh has attracted almost 30 cornerstone investors, including Aberdeen Standard Investments.
AIA Group Ltd, Great Eastern Life Assurance, Franklin Templeton Investment and some Malaysian state funds had also signed on.
The IPO is expected to raise about RM1bil.
“In the span of 12 years, we have grown into one of the nation’s leading dairy producers despite stiff competition from other brands. This underwriting ceremony takes us one step closer to our proposed debut on the Main Market,” Farm Fresh group managing director and group chief executive officer Loi Tuan Ee said in a statement.
According to its draft prospectus posted on the Securities Commission Malaysia website, Khazanah’s stake will be reduced to 11.57%-13% post-IPO from 30%.
Meanwhile, Loi’s indirect shareholdings will be pared to between 43.65% and 45.72% from 70%.
Proceeds from the listing exercise will be used to establish a new manufacturing hub and integrated processing facility in Malaysia as well as expand its production facility in Australia.
The group posted revenue of RM490.5mil for the financial year ended March 31, 2021, a 62% jump from RM303.1mil in the previous year. Profit after tax attributable to shareholders rose to RM36.3mil from RM35.2mil.
CIMB and Maybank are the joint global coordinators, joint bookrunners, joint managing underwriters and joint underwriters for the IPO.
Credit Suisse is also participating as the joint global coordinator and joint bookrunner for the listing exercise while Affin Hwang, AmInvestment, Hong Leong and RHB are the joint underwriters for the IPO.
CIMB is the sole principal adviser for the listing exercise.