Solarvest targets to raise RM35m from IPO on ACE Market


SOLARVEST Holdings Bhd aims to raise RM34.6 million from its initial public offering (IPO) on the ACE Market of Bursa Malaysia, largely for its working capital for daily operations and future projects.

The IPO entails a public issue of 98.83 million new shares with 19.5 million shares available for the public at 35 sen a share, the group added.

The public issue represents 25.3% of its enlarged share capital of the company.

Some 39 million shares will be offered to Bumiputera investors through the Ministry of Trade and Industry, while 20.7 million new shares will be offered via private placement to selected investors.

Upon listing, Solarvest will have market capitalisation of RM136.7 million based on an enlarged share capital of 390.6 million shares.

The solar photovoltaic (PV) system specialist intends to spend RM19.2 million or 55.5% from the IPO proceeds for its operations, while RM4 million or 11.5% will be used to upgrade its information technology software and hardware.

Some RM5 million or 14.5% will be utilised for repayment of bank borrowings and the remaining to pay for its listing expenses.

Solarvest will use RM3 million or 8.7% to expand the group’s presence in the domestic and international markets.

Locally, Solarvest will spread its footprint in Negri Sembilan, Melaka and Johor, and has plans to enter into international markets like Vietnam and Taiwan.

Solarvest CEO Davis Ching Chun Shiong said Malaysia’s solar sector is experiencing an expansionary phase and there’s an increasing level of interest in solar power generation.

“The upward growth trajectory of the new renewable energy industry in Malaysia will undoubtedly provide Solarvest new growth opportunities, especially in the large-scale solar PV segments.

“All solar contractors for engineering, construction and commissioning of large-scale solar 3 projects are now required to be 100% local,” he said at the launch of Solarvest’s prospectus in Kuala Lumpur yesterday.

According to independent market researcher, Protege Associates Sdn Bhd, the total solar PV installed capa- city in Malaysia is set to grow at a compound annual growth rate of 50% between 2018 and 2023.

Last month, the Energy, Science, Technology, Environment and Climate Change Minister Yeo Bee Yin highlighted that Malaysia is targeting to increase the renewable energy usage to 20% by 2025.

Solarvest is optimistic the IPO will position the company to better harness the rising market opportunities in the solar sector, as well as enable it to gain access into the capital markets for future growth.

Solarvest is slated to be listed on Nov 26, 2019. This would be the 10th ACE Market listing for the year from a total of 23 listings in Bursa Malaysia year-to-date.

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

Solarvest is 45% owned by Main Market listed, Chin Hin Group Bhd. Upon completion of the IPO, Chin Hin’s shareholding will fall to 33.6%.

Solarvest specialises in turnkey engineering, procurement, construction and commissioning services for solar PV systems.

It also provides operations and maintenance services of solar PV systems.