JOHOR-based wholesaler and distributor of fresh vegetables, F&B products and other groceries, Farm Price has entered into an underwriting agreement with Alliance Islamic Bank Berhad (AIS) in conjunction with its upcoming initial public offering (IPO) on the ACE Market of Bursa Malaysia Securities Berhad.
Farm Price’s IPO exercise encompasses a public issuance of 102.00 million new ordinary shares, representing 22.67% of its enlarged share capital, as well as an offer for sale of 33.00 million existing shares, or 7.33% of its enlarged share capital, via private placement to selected investors.
Out of the 102.00 million new shares, 22.50 million shares will be made available to the Malaysian public via balloting, 11.25 million shares to its eligible directors, employees and persons who have contributed to the success of Farm Price (Pink Form Allocations), while the remaining 68.25 million shares will go towards private placements to selected investors.
Pursuant to the underwriting agreement, AIS shall underwrite 33.75 million new shares made available to the Malaysian Public and Pink Form Allocations.
Farm Price, via its subsidiaries (collectively known as the “Group”), is principally involved in the wholesale and distribution of fresh vegetables, as well as F&B products and other groceries.
It also operates a retail store in Ulu Tiram, Johor to sell fresh vegetables, F&B products and other groceries directly to end-consumers. Wholesale distribution segment was the largest revenue contributor to the Group.
Currently, the Senai Centralised Distribution Centre coupled with the cold chain infrastructure of refrigerated trucks and cold room facilities enables the Group to deliver fresh vegetables efficiently and promptly to meet the customers’ needs mainly in the state of Johor as well as Singapore.
The Group also maintains six other regional distribution centres in Johor, Selangor, Perak and Penang, which are focusing on the wholesale distribution of F&B products and other groceries.
It has also obtained Halal certification for prepacked and fresh-cut vegetables at the same facility, assuring product integrity and opening doors to broader market reach.
“We are delighted to sign this underwriting agreement with AIS, bringing us a step closer to our upcoming listing on the ACE Market of Bursa Securities,” Farm Price managing director Dr Tiong Lee Chian said in a statement on Friday (April 5).
“This unlocks greater resources and flexibility to fuel our expansion plans and explore new avenues for growth.
“It is our firm belief that the fresh vegetables industry is crucial to Malaysia’s food security, supporting public health, sustenance, and affordability.
“As a wholesale distributor, we play a key role in the supply chain where we source fresh vegetables from domestic and foreign growers, distributors and importers to provide us with a range of vegetables to meet the fresh vegetable requirements of our customers mainly in Johor and Singapore.”
Today, Farm Price offers a vast selection of fresh vegetables to meet the diverse needs of our customers. In addition to variety, we also provide value-added services such as the processing of prepacked and fresh-cut vegetables to enhance convenience and reduce preparation time for our customers.
Recognising the essential nature of the industry, Tiong underscored Farm Price’s commitment to long-term growth, saying as part of its strategies, there are plans to construct additional facilities to expand their Senai Centralised Distribution Centre, which is expected to double the size of their current facilities.
“In addition, we will also establish additional regional distribution centres with cold room facilities in Nilai, Negri Sembilan and Cameron Highlands, Pahang, and set up a sales and marketing office in Singapore,” he added.
“These initiatives will allow us to expand our operational facilities and market coverage for business growth.”
Farm Price is scheduled to be listed on the ACE Market of Bursa Securities by May 2024, with AIS as the principal adviser, sponsor, sole underwriter and placement agent for the IPO exercise. – April 5, 2024
