KUALA LUMPUR: Unitrade Industries Bhd, which is slated to be listed on the Ace Market of Bursa Malaysia on June 14, said the public portion of its initial public offering (IPO) has been oversubscribed by 2.35 times.

       The homegrown building materials wholesalers and distributors received a total of 7,169 applications for 261.95 million shares with a value of RM83.8mil from the Malaysian Public for the 78.12 million shares, representing an oversubscription rate of 2.35 times.

       Unitrade, in a statement, said for the general public portion, a total of 3,684 applications for 39.06 million shares were received, translating to an oversubscription rate of 3.90 times.

       For the remaining Bumiputera public portion, a total of 3,485 applications for 39.06 million shares were received, representing an oversubscription rate of 0.81 times.

       Unitrade’ listing entails a public issue of 312.5 million new ordinaryat an issue price of 32 sen per share, representing approximately 20.0% of the enlarged share capital, raising RM100mil, along with the offer for sale of 125 million existing shares by way of private placement to selected investors.

       Managing director Nomis Sim Siang Leng said the company was pleased with the positive response as it reflects the market’s healthy interest and confidence in its business model and growth prospects.

       “Looking ahead, we are confident in maintaining our positive growth momentum, driven by the rising construction activities and acceleration of large-scale infrastructure projects in the pipeline.

       “With that in mind, the listing comes at an opportune time as we will deploy a large portion of our IPO proceeds as working capital to enhance our inventories range and products mix to meet the increasing demand for building materials.

       “As a wholesaler and distributor, the additional working capital is essential for us to fuel our future growth. By tapping into the equity capital market, it allows us to achieve just that without incurring additional interest expenses,” he said.

       Upon listing, Unitrade will have a market capitalisation of RM500mil based on the issue price of 32 sen and its enlarged share capital of 1.56 billion shares.

       M & A Securities Sdn Bhd is the advisor, sponsor, underwriter and placement agent for the IPO exercise.