KUALA LUMPUR: Furniture exporter Wegmans Holdings Bhd aims to raise RM29 million from its initial public offering (IPO) on Bursa Malaysia next month.
In a language exclusive interview here recently, Wegmans executive director Collin Law Kok Lim said the group intends to channel most of the funds raised to expanding its manufacturing facilities in Muar, Johor.
"We are targeting to raise RM29 million from the IPO. From that total, RM22 million will go to set up new factories, purchase new machinery and build hostels to house foreign workers. The remaining RM7 million is for working capital and listing expenses," he said.
Wegmans makes and exports dining tables and chairs, living room furniture, bedding and cupboards.
"We're a mid-size manufacturer chalking up around RM85 million export sales per year. We ship out most of our furniture to Japan, the US, Australia and the UK," said Law.
Wegmans’ IPO involves the public issue of 100 million new shares, of which 25 million shares will be made available for Malaysian public, 15 million for eligible directors, employees and persons who have contributed to the group and its subsidiary’s success.
Meanwhile, the remaining 10 million shares will be made available by way of private placement to institutional and identified investors, and 50 million shares to identified bumiputra investors approved by the Ministry of International Trade and Industry.
There will also be an offer-for-sale of 50 million of existing shares via private placement.
For the past four months, the ringgit had strengthened against the US dollar, from a weak level of RM4.30.
Yesterday, the ringgit continue to appreciate against the US dollar to close at RM3.92, the highest in 18 months.
When asked how Wegmans is coping with the foreign exchange fluctuations, Law said: "We have been raising our prices as we come up with new collections. Most of our regular clients accept currency fluctuation. We will continue to monitor and do the necessary to maintain our profit margin.”