MTAG to raise RM72m from ACE Market IPO


MTAG Group Bhd will use half of the RM72.3 million it plans to raise from its initial public offering (IPO) to buy land and raise printing and converting capacity.

MTAG MD Chaw Kam Shiang said 45.6% or RM33 million from the IPO proceeds will be used for the acquisition of a 10-acre (4.05ha) parcel of land for the construction of its new manufacturing plant.

“The expansion plans that we have in place would enable us to accommodate the increasing demand from our existing customers and take on new business.

“These, in turn, allow us to capture a larger market share, further cementing our position in the local label printing and converting industry, and ultimately take MTAG to the next level,” Chaw said to reporters yesterday during the group’s prospectus launch in Kuala Lumpur.

The group also earmarked 18% or RM13 million for capital expenditure for the purchase of 11 new machineries.

The new capacity will boost its annual production of labels and stickers to 636.8 million pieces from current capacity of 324.5 million pieces.

The remaining funds raised will be used for repayment of bank borrowings and working capital amounting to RM10 million and RM12.5 million respectively.

Commenting on the group’s prospects, MTAG ED Philip Lau said British technology company, Dyson Ltd, and VS Industry Bhd are among its existing customers and MTAG expects that higher demand from these companies will provide growth for the group.

MTAG’s dividend policy will see 20% of the group’s earnings given to shareholders.

MTAG’s IPO, scheduled for Sept 25, is the eighth ACE Market listing for the year from a total of 21 listings in Bursa Malaysia thus far.

MTAG’s IPO exercise entails an issuance of 136.32 million new shares at 53 sen a share, representing 20% of the group’s enlarged share capital.

Upon listing, the group will have an enlarged share capital of 681.6 million shares, with a market capitalisation of RM361.3 million.

Post-IPO, Chaw will hold a 50.5% stake, with Lau, MTAG chief human resources officer Ang Yam Fung and ED Goh Jui Heng holding 16.7%, 2% and 0.8% respectively.

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

Established in 1995, MTAG is a group of companies encompassing Toyo Sho Industrial Products Sdn Bhd, Intag Industrial Supplies Sdn Bhd and Intag Steel Hardware Sdn Bhd.

The Johor-based MTAG is a printing and materials converting specialist — providing printing of labels and stickers, besides being the authorised distributor for 3M and Henkel brands — distributing industrial tapes and adhesive products.