The company intends to raise some RM2b from its IPO with a total of 1.5b shares to be listed on Bursa
By MARK RAO / Pic By TMR
QSR Brands (M) Holdings Bhd plans to expand its food retail business in Malaysia via funds from its proposed listing as the company inches closer to return to the local bourse.
The operator of the Kentucky Fried Chicken (KFC) and Pizza Hut brands in Malaysia and the region intends to raise some RM2 billion from its initial public offering (IPO) with a total of 1.46 billion shares to be listed on the Main Market of Bursa Malaysia.
This is to mark the company’s return to the exchange after it was taken private back in February 2013.
In its prospectus, QSR noted that the IPO proceeds will be utilised to expand its KFC business in the country where it operates a total of 698 outlets.
The company also said it aims to increase the profitability of the business, while expanding the food chain’s network of outlets to strengthen its market position.
“We intend to continue to capitalise on the strong brand and market leadership of our KFC business by further increasing our geographical footprint and market penetration.
“(This will be done) through the expansion of our network of KFC outlets across Malaysia, including in under-penetrated cities and towns or other areas with potential for network expansion,” it noted.
As for the Pizza Hut business, QSR said it plans to continue to rationalise its network of outlets and optimise the current business model in order to grow a healthy and profitable business. The company operates 388 Pizza Hut outlets in the country.
According to the prospectus, QSR is Malaysia’s largest restaurant chain operator based on market share and number of outlets.
The company garnered RM4.56 billion in revenue last year, while its gross profit margin was 60.3%. Its gross profit for 2017 was RM2.56 billion and net profit stood at RM113.44 million.
Johor Corp is the largest shareholder in the company with a 51% stake.
Its president and CEO Datuk Kamaruzzaman Abu Kassim was reported as saying that the IPO could raise RM2 billion in funds based on an estimated RM6 billion market valuation upon listing.
The Employees Provident Fund and CVC Capital Partners are the other major holders with stakes of 25% and 24% respectively.
Up to 1.29 billion shares will be made available to both foreign and local institutional investors via the IPO exercise, representing an approximately 31% of QSR’s enlarged issued share capital, at a price to be determined via a book-bidding process.
The retail offering is to involve the issuance of 167.53 million shares, of which 125.65 million or 3% of the company’s total share capital will be made available to the public.