KUALA LUMPUR (May 6): Logistic services provider Sin-Kung Logistics Bhd, which is set to be listed on the ACE Market of Bursa Malaysia on May 15, said its initial public offering (IPO), priced at 13 sen apiece, had been oversubscribed by 26.5 times.

By the close of its IPO application on May 2, Sin-Kung said it had received 13,179 applicants for 1.7 billion new shares from the Malaysian public for the 60 million shares it allocated for public subscription — representing an overall subscription rate of 26.5 times.

Of this, 7,360 applications for 680.7 million shares were received for the Bumiputera portion, representing an oversubscription of 21.7 times. The non-Bumiputera portion drew 5,819 applications for 971.8 million shares, representing an oversubscription rate of 31.4 times.

The 45 million shares it made available for its eligible directors, employees and persons who have contributed to the success of the group have been fully subscribed.

The 198.5 million shares that were made available for application by way of private placement to Bumiputera investors approved by the Ministry of Investment, Trade and Industry (Miti) and selected investors have also been fully placed out.

Sin-Kung's IPO involves a public issuance of 200 million new shares — representing 16.7% of the enlarged share capital of Sin-Kung Logistics — and an offer for sale of 103.5 million existing shares (8.6%).

Sin-Kung Logistics currently operates five warehouses in the central and northern regions of Peninsular Malaysia, and owns about 460 commercial vehicles for its logistics business.

Its major customers include airlines, sales agents of airlines, local and international freight forwarders, manufacturers and online retailers.

It plans to use the RM26 million it expects to raise from the IPO to expand its warehousing and distribution services, repay bank borrowings, buy new commercial vehicles as well as for working capital and to pay for its listing expenses.

The sale of existing shares is expected to gross RM13.5 million, which will go entirely to the selling shareholders Sin-Kung managing director Alan Ong and his sister Angeline Ong, who is an executive director.

Based on an enlarged share capital of 1.2 billion shares, Sin-Kung Logistics is expected to have a market capitalisation of RM156 million after listing.

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