KUALA LUMPUR: TCS Group Holdigs Bhd, a building and infrastructure construction services provider, aims to raise RM20.7 million from the upcoming listing on Bursa Malaysia's ACE Market.
Launching its prospectus today, TCS Group has set plans to further strengthen its presence in the high rise, purpose-built and institutional buildings segments, backed by its track record in building construction projects.
Managing director Datuk Ir Tee Chai Seng said the prospectus launch marked another major milestone for TCS Group in its quest to be a listed company.
"We are confident the listing exercise will allow us to further strengthen our foothold in the construction industry as it enables us to gain access into the capital markets to fuel our expansion plans," Tee said in a statement today.
From the IPO's public issue, RM13.0 million or 62.8 per cent from the total proceeds is earmarked for the purchase of new construction machinery and equipment within 36 months of listing.
A total of RM4.2 million or 20.3 per cent is for working capital for construction projects within 24 months from listing and the balance RM3.5 million or 16.9 per cent to defray the listing expenses within three months of listing
TCS' IPO entails a public issue of 90.0 million new shares representing 25.0 per cent of its enlarged total number of shares, as well as an offer for sale of up to 18.0 million shares.
The 90.0 million new shares include up to 10.8 million shares for the public via balloting, with at least 5.4 million being set aside for Bumiputera investors, and up to 7.2 million shares for eligible directors, employees and persons who have contributed to the company's success.
Up to 32.4 million shares will be allocated for institutional and selected investors by way of private placement, and the remaining 39.6 million shares to be placed out to identified Bumiputera investors approved by the Ministry of International Trade and Industry.
Tee said the long-term prospects of the construction industry remain promising, notwithstanding the near-term challenges brought about by the outbreak of the Covid-19 pandemic.
The optimism is underpinned by the implementation of various government measures and economic stimulus packages to strengthen the Malaysian economy.
"We will also broaden our revenue stream by venturing into infrastructure construction services to include major roads, highways and bridges.
The proceeds from the IPO would certainly help accelerate in bringing these plans to fruition, he said.
In terms of financial performance, TCS' revenue increased from RM103.6 million in the year ended December 31 2016 (FY2016) to RM358.4 million in FY2019, representing a three-year compounded annual growth rate of 51.2 per cent.