CPE Technology Bhd, an engineering precision parts manufacturer, has priced its shares at RM1.07 apiece for its initial public offering (IPO) seeking to raise approximately RM179.58 million. The company will be listed on the Bursa Malaysia’s Main Market on December 7, 2023, with a market capitalization of RM718.31 million, based on an enlarged issued share capital of 671.31 million.
The IPO involves the issuance of 167.83 million new ordinary shares, representing 25% of the enlarged share capital. CPE is involved in the manufacturing of precision-machined parts and components and provision of computer numerical control machining services. Its main customer industries include semiconductor, life science and medical devices, and sports equipment, with key clients in the US, Singapore, and Malaysia.
In the financial year ended June 30, 2023, CPE’s net profit slipped 10.67% to RM30.29 million from a record RM33.91 million in FY2022, while revenue rose 4.63% to RM145.28 million from RM138.85 million. Of the new shares to be issued in the IPO, 33.6 million shares are meant for subscription by the Malaysian public, 83.9 million shares for Bumiputera public investors, and 50.3 million for institutional and selected investors by way of private placement.
The IPO will also see the offer for sale of 67.13 million shares, representing a 10% stake, to institutional and selected investors through private placement. The proceeds raised will be used for various purposes, including the acquisition of new industrial lands, construction of new plants, machinery and equipment expenses, bank borrowing repayment, working capital expenditure, and other capital expenditures.
CPE’s largest shareholders include group CEO Lee Chen Young, who will hold a 32.5% stake in the company post-IPO, non-independent non-executive director Foo Ming (19.5%), and executive director Mu Woon Chai (13%).