Eco-Shop Marketing Sdn Bhd, a Malaysian discount retail chain, plans to raise RM419 million in what will be the country’s largest IPO in eight months.
The company will offer 347 million shares at RM1.21 each, valuing Eco-Shop at RM7 billion, while also seeking an additional RM623 million through a private placement to institutional investors, Bloomberg reported today,.
The cornerstone investors include AHAM Asset Management, Albizia Capital Pte Ltd, Areca Capital Sdn Bhd, Eastspring Investments Bhd, Kairous Equity Sdn Bhd, Kenanga Investors Bhd, Kenanga Islamic Investors Bhd, Lion Global Investors Ltd, RHB Asset Management Sdn Bhd and RHB Islamic International Asset Management Bhd.
Maybank Investment Bank is acting as principal adviser, joint global coordinator, joint bookrunner and sole underwriter for the IPO. UBS Securities Malaysia Sdn Bhd and UBS AG Singapore Branch are also joint global coordinators and bookrunners, while RHB Investment Bank joins as a joint bookrunner.
Eco-Shop, which mainly sells items at RM2.60, plans to double its store count by opening 70 new outlets annually over the next five years using the funds raised.
Chief executive officer Jessica Ng said the business model is especially relevant in the current cost-of-living environment, during the prospectus launch in Selangor.
Founded in 2003 by Lee Kar Whatt, Eco-Shop currently operates 350 outlets across Malaysia and holds a dominant 68 per cent market share in the local discount retail sector.
The IPO is the latest indicator of resilience in the Malaysian consumer sector, which also saw last year’s largest listing in 99 Speed Mart Retail Holdings Bhd’s US$530 million debut.
Applications for the retail portion will close on May 7, with the company slated to list on May 23. At the retail IPO price, Eco-Shop would debut with a market capitalisation of RM7 billion.