MUAR-based ready-to-assemble (RTA) furniture specialist, Ecomate Holdings Bhd expects to continue capitalising on high demand for RTA furniture with consumers increasingly pivoting towards purchasing furniture products online to enhance their home experience.
The company, which is en route a listing in Bursa Malaysia’s ACE Market, said the flat pack format of its furniture products is very suitable for sale via e-commerce platforms due to their compact nature which enhances logistics efficiency.
“Coupled with the affordable price range through the use of eco-friendly materials in our furniture such as chipboard and medium density fibreboards, our products appeal widely to mass consumer groups around the globe,” commented the company’s managing director Jason Koh Jian Hui.
“In order to capture a bigger share of the growing RTA furniture markets, we will be utilising part of the proceeds from the IPO exercise to acquire machinery and equipment to enhance our automation processes and increase our production capacity which is currently near full utilisation.
“In addition, a portion of the proceeds will go toward the construction of a new factory and hostel in Muar Furniture Park.”
Ecomate will raise approximately RM16.2 mil from its IPO exercise with the planned utilisation of proceeds as follows:
- RM6 mil (37.1%) for acquisition of machinery and equipment;
- RM2 mil (12.4%) for the construction of its third factory which is expected to house three additional production lines and one block of four-storey detached hostel;
- RM5.3 mil (32.6%) for the purchase of raw materials to support production activities; and
- The balance RM2.9 mil (17.9%) to defray estimated listing expenses.
The company’s IPO entails a public issue of 49 million new shares which represent about 14% of the enlarged share capital along with an offer for sale of 30 million existing shares by way of private placement to selected investors.
Of the public issue of 49 million new shares, 17.50 million shares are made available for the Malaysian public; 8.75 million new shares available for eligible directors, employees and people who have contributed to the group’s success; and 22.75 million new shares by way private placement to selected investors.
The group is scheduled to be listed on the ACE Market on Nov 8 with a market capitalisation of RM115.5 mil based on the issue price of 33 sen with an total number of issued shares of 350 million.
Pursuant to the launch of Ecomate’s prospectus, applications for the public issue are open from today till 5pm on Oct 25.
M&A Securities Sdn Bhd is the adviser, sponsor, underwriter, and placement agent for the IPO exercise. – Oct 15, 2021
