by ANIS HAZIM

UMEDIC Group Bhd (UMC) targets to raise about RM31.11 million from its IPO for the construction of a new factory, setting up its new marketing and distribution offices, repayment of borrowings, working capital and listing related expenses.

The IPO entails a public issue of 97.22 million new shares at an offer price of 32 sen apiece and is slated to be listed on the ACE Market of Bursa Malaysia on July 26.

For the public issuance, 18.7 million shares will be made available to the Malaysian public, 13.09 million to the group’s eligible directors and employees and another 65.44 million to be made available via private placement to selected investors.

Based on UMC’s enlarged share capital of 373.91 million shares and IPO price, the market capitalisation will be RM119.65 million.

UMC and its subsidiaries are principally involved in marketing and distribution of various branded medical devices and consumables, as well as the provision of after sales services for all its products.

Of the total proceeds, RM9 million will be utilised for the repayment of borrowings and RM8.66 million for its working capital.

Another RM6.8 million is for the setting up of new marketing and distribution offices, while the remaining RM3.5 million is for the construction of a new factory.

UMC legal and corporate advisor Ng Sze Hui said that the group intends to increase the production capacity to further improve its service.

“Our production capacity is around 75% as of right now and we are targeting around 80% this year,” Ng said in a press conference after its IPO prospectus launch on Wednesday.

She said that the group targets to increase its pre-filled humidifier production to around 300,000 bottles per month compared to 200,000 bottles currently, in the following months.

Several new products are also set to be launched this year.

UMC ED and CEO Eric Lim is optimistic on the company’s outlook this year, saying that the management team foresees an untapped potential and valuable opportunities in the medical device industry.

Affin Hwang Investment Bank Bhd is the principal adviser, sponsor, sole placement agent and sole underwriter for UMC’s IPO exercise.