ACE Market-bound Northern Solar Aims To Raise RM42.4 Mln From IPO

KUALA LUMPUR, Dec 18 (Bernama) -- Solar renewable energy specialist Northern Solar Holdings Bhd aims to raise RM42.4 million through its initial public offering (IPO) in conjunction with its listing on the ACE Market of Bursa Malaysia. 

The IPO involves the public issue of 67.3 million new shares and an offer for sale of 35.6 million existing shares at RM0.63 per share.

The listing is scheduled for Feb 6, 2025.

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Speaking at the launch of Northern Solar’s prospectus, managing director Lew Shoong Kai said that following the IPO, Northern Solar aims to expand its business by increasing the company's focus and coverage of Malaysia to include the states of Penang, Perak, Kedah, Perlis and Sabah.

"Along with this, we set up a new corporate office with an engineering command centre to more efficiently streamline our operation.

"The command centre will of course be equipped with solar photovoltaic (PV) system monitoring and management equipment to provide real time monitoring of solar PV systems for customers," he said.

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Lew said the company also intended to pursue a model of developing, owning and managing a portfolio of solar PV assets that sell the electricity generated to Net Energy Metering (NEM) and Self-consumption (SELCO) consumers to generate a stable inflow of revenue.

"For all these plans, we will be setting aside RM32.3 million, which is about 76 per cent of the IPO proceeds," he said. 

According to the prospectus, the company plans to use RM29.2 million or 68.8 per cent of the proceeds raised from the IPO for working capital purposes to expand its solar photovoltaic (PV) systems business.

"A further RM3.2 million (7.4 per cent) of the proceeds will be used to establish a new corporate office with an engineering command centre in Petaling Jaya as well as to fund the establishment of an expanded office in Johor and an additional office in Penang to strengthen its market presence in the southern and northern regions of Peninsular Malaysia.

"The remainder of the proceeds will be used to repay bank borrowings amounting to RM5.5 million (13.0 per cent) and to defray the estimated listing expenses of RM4.6 million (10.8 per cent)," it said.

Northern Solar said that based on its enlarged share capital of 395.6 million shares at a share price of RM0.63, the market capitalisation is projected to be RM249.2 million.

The IPO is open for subscription from today to Jan 20, 2025.

M & A Securities Sdn Bhd is the adviser, sponsor, underwriter and placement agent for the IPO exercise.

-- BERNAMA