Capital markets executive summary | Mon 8 Jan 2024

Capital markets executive summary | Mon 8 Jan 2024

KJTS prices IPO at 27 sen

The company, which launched its prospectus on Fri, will raise RM58.9m from the issuance of 218.03m new shares or 31.69% of the enlarged shares. The price values the company at a price-earnings multiple of 26 times its profit after tax of RM6.87m for FY2022. The new shares comprise 168.63m shares or 24.51% for selected investors, 34.4m shares or 5% for the Malaysian public and 15m shares or 2.18% for directors and employees. The IPO proceeds will be used for expanding the cooling energy segment (RM40.4m), office expansion in Malaysia, Thailand and Singapore (RM4.5m), working capital (RM8.1m) and listing expenses (RM5.8m). KJTS provides engineering, procurement, construction and commissioning services for cooling energy systems (46.32% of FY2022 revenue), cleaning services (37.91%), and facilities management services (15.77%). The company will list on the ACE Market on 26 Jan 2024. Hong Leong Investment Bank is the principal adviser, sponsor, sole underwriter and sole bookrunner.

Scientex fails in second attempt to buy Johor land from SP Setia

In 2021, Scientex Lestari Sdn Bhd tried to purchase the 960-acre freehold land in Tebrau, Johor Baru for RM518.1m. The parties gave up in Mar 2023 after Scientex failed to get a waiver of the bumiputra equity condition imposed by the Economic Planning Unit (EPU). In Jul 2023, the parties struck a new deal at a higher price of RM547.65m. On Fri, the parties announced that the deal has been terminated because of non-fulfilment of the conditions precedent within the extended completion period. Scientex was unable to obtain the approval from the EPU for the acquisition. SP Setia will refund the deposit plus interest accrued. The sale and purchase agreement (SPA) will be allowed to lapse and be of no further effect. The parties will be released from all further obligations under the SPA except for any antecedent breaches. Scientex closed at RM3.97. SP Setia closed at 95 sen.
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Perak Transit proposes bonus issue

The public transportation service provider and petrol station operator announced the bonus issue of up to 433.64m new shares on the basis of 1 bonus share for every 2 existing shares. On 2 Jan, the company had 742.13m shares and 125.16m outstanding warrants. Based on the share price of RM1.14 on 2 Jan, the theoretical ex-bonus share price will be 76 sen. Apart from rewarding existing shareholders, the larger number of shares will encourage trading liquidity. The largest shareholder is founder and MD Datuk Seri Cheong Kong Fitt with 29.6% shareholding. Hextar’s Datuk Eddie Ong Choo Meng is the 2nd largest shareholder with 9.9%, followed by Tropicana’s Tan Sri Danny Tan Chee Sing with 6.2%. The proposed bonus issue requires shareholders’ approval and will be completed by 1Q2024. AmInvestment Bank is the principal adviser. The counter closed at RM1.15.

American Tower selling India business

The US networking company, which started operating in India in 2007, has more than 75k towers that serves all major telecom service providers in the country. It will be selling the business to an infrastructure investment trust backed by a Brookfield Asset Management affiliate for USD2.5b (RM11.48b). The deal will close in 2H2024 and lets American Tower focus on telecommunications tower and data centre operations in other markets including the US. Investment firm Brookfield expects the business to grow because the Indian economy is expanding faster than other large countries and smartphone usage rising rapidly.

Ant Group is about to close MultiSafepay acquisition

Ant Group, 33% owned by Alibaba, is negotiating to buy 100% of the Dutch payments company valuing it at USD200m (RM930.90m). The transaction is subject to regulatory approval. MultiSafepay was formed in 1999 and provides payment acquiring and processing services to more than 18k SMEs and additional services in collaboration with commercial partners. MultiSafepay is owned by founder and CEO Olaf Geurs. It has offices in Spain and Germany. Net profit was EUR1.3m (RM6.63m) and gross income was EUR11.9m in 2022. Ant runs Alipay+, a cross-border payments platform. In 2019, the company bought British payments group WorldFirst for USD700m. In 2022, it purchased Singapore-based payments firm 2C2P.