MTAG GROUP AIMS TO RAISE RM72.3 MILLION FROM IPO

KUALA LUMPUR, Aug 19 (Bernama) -- Johor-based printing and materials converting specialist, MTAG Group, aims to raise RM72.3 million from its initial public offering (IPO) on Bursa Malaysia's ACE market, scheduled for Sept 25.

Of the total proceeds, RM33 million or 45.6 per cent would be allocated for a 4.04-hectare land acquisition in Senai or Tebrau for the construction of a new manufacturing plant, according to executive director, Philip Lau Cher Liang.

"The construction will be carried out in two phases. The first phase shall comprise a built-up area of 200,000 square feet," he told reporters after the launch of the company’s prospectus here, today.

Lau said RM13 million or 18 per cent of the IPO has been earmarked for capital expenditure, involving the purchase of new machinery to boost its annual production of labels and stickers to 636.8 million pieces from its current capacity of 324.5 million pieces.

"Our expansion plan will enable us to accommodate the increasing demand from our 600 existing customers from various industries while taking on new businesses.

"This will, in turn, allow us to capture a larger market share which is targeted to reach RM8.11 billion by 2023, further cementing our position in the local label printing and converting industry," he added.

He said the proceeds from the IPO will also be used for the repayment of bank borrowings (RM10 million), working capital (RM12.5 million) and defraying listing expenses (RM3.8 million).

The group's IPO entails the issuance of up to 136.32 million shares, representing 20 per cent of its enlarged share capital at an issue price of 53 sen per share.

The group has allocated 34.08 million shares for public issue, representing five per cent of its enlarged share capital, while another 34.08 million shares will be reserved for the group's directors and eligible employees.

Another 68.16 million shares, representing 10 per cent of the group's enlarged share capital, will be reserved for Bumiputera investors. 

-- BERNAMA