The Johor-based company said on Thursday the initial public offer (IPO) comprised of 54 million shares at an issue price of 70 sen per share -- 37.78 million new shares and 16.22 million existing shares.
Under the listing exercise, it would be selling nine million shares to the public, three million units for eligible directors, employees and other persons who have contributed to the success of the company.
Xin Hwa said 18.22 million shares would be offered to approved Bumiputera investors while the remaining 23.78 million shares would be placed out to selected investors.
Based on the issue price of 70 sen per share and the enlarged issued and paid-up of 180 million shares, it would have a market capitalisation of RM126mil.
It said of the RM26.45mil to be raised from the IPO, it plans to use RM11.35mil to expand its fleet and RM4.75 to build a new warehouse, RM3.75mil to repay borrowings, RM3.08mil as working capital and the remaining RM3.51 for estimated listing expenses.
Xin Hwa managing director Ng Aik Chuan said at the launch of the prospectus that its strong fundamentals would put it in good stead.
He said the proceeds raised would be mainly used to expand its business which included the construction of a new warehouse in Pasir Gudang, Johor measuring 220,000 sq. ft. and to buy 101 new vehicles such as prime movers and trailers.
Ng said the new warehouse was expected to start operations in the third quarter of 2015 while the purchase of vehicles would be over the next 24 months.
“Xin Hwa would continue to capitalise on its strengths to generate sustainable revenue from its existing business,” he added.
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