MKH to list palm oil unit on Bursa Malaysia Main Market

MKH Bhd has proposed to list its wholly owned subsidiary, MKH Oil Palm (East Kalimantan) Bhd (MKHOP), on the Main Market of Bursa Malaysia by the fourth quarter of this year.

In conjunction with the proposed listing and prior to the proposed initial public offering (IPO), MKHOP plans to undertake a proposed a share split, proposed acquisition of PT Maju Kalimantan Hadapan (PT MKH) and PT Sawit Prima Sakti (PT SPS), proposed capitalisation, and thereafter, for MKH to undertake a proposed distribution.

Prior to the proposed IPO, MKH said MKHOP will undertake a share split involving the subdivision of every one existing ordinary share in MKHOP into six new MKHOP shares amounting to 662.81 million units worth RM110.47 million.

On completion of the proposed share split, MKHOP will acquire 5.67% stake in PT MKH from Metro Kajang (Oversea) Sdn Bhd and PT Hikmat Aliran Sukses for RM53.52 million through the issuance of 44.23 million new MKHOP shares to the vendors at an issue price of RM1.21.

MKHOP will also acquire the entire equity interest in PT SPS from MKH Plantation Sdn Bhd, Ivakijaya Sdn Bhd, and PT Hikmat for RM27.86 million via the issuance of 23.03 million new MKHOP shares to the vendors at an issue price of RM1.21.

Upon completion of the proposed share split and acquisitions, MKHOP plans to undertake a proposed capitalisation whereby PT MKH and PT SPS would novate the amount owing to Metro Kajang (Oversea) Sdn Bhd totalling RM118.97 million to MKHOP.

MKHOP will then capitalise RM88.97 million of the enlarged borrowings with the issuance of 73.53 million shares at RM1.21 apiece. 

The remaining RM30 million of the borrowings is to be repaid from its IPO proceeds.

Upon completion of the proposed pre-IPO reorganisation, MKH proposes to undertake a distribution by way of dividend-in-specie of 10.3% in MKHOP or 82.48 million shares on a one-to-seven basis to entitled shareholders.

Upon completion of the proposed distribution, the total shareholdings of MKH together with Metro Kajang (Oversea) and MKH Plantation in MKHOP will reduce to 84.2% from 94.4%.

MKH will then undertake the IPO of 250.71 million MKHOP shares, representing 24.5% of the unit’s enlarged share capital at an issue price to be determined later.

The listing exercise comprises 220 million new shares under the public issue and an offer for sale of 30.71 million existing MKHOP shares held by Metro Kajang.

“The proceeds to be raised from the proposed offer for sale will accrue entirely to MKH Group and is proposed to be utilised for repayment of loans and borrowings and to defray expenses relating to the proposed offer for sale,” MKH said.

“The applications to the relevant authorities in relation to the proposals will be submitted by March 31, 2023. Barring any unforeseen circumstances, the proposals are expected to be completed by the fourth quarter of 2023,” said MKH.

M&A Securities has been appointed as MKH and MKHOP’s advisers for the proposals.

MKH shares were unchanged at RM1.19 today, with a market capitalisation of RM697.99 million. – TMR