OFFICIALLY LISTED: (From left) Solid Automotive independent non-executive director Azahar Baharudin, managing director Ker Min Choo, Chee, executive director and chief financial officer Ong Kheng Swee, executive director Ker Mong Keng, executive director Ker Meng Oi and independent non-executive director Kek Kok Swee during the listing.
KUCHING: Leading automotive aftermarket parts and components trading and distribution group Solid Automotive Bhd (Solid Automotive) made its debut on the Main Market of Bursa Malaysia Securities Bhd (Bursa Malaysia), when its shares commenced trading under the stock name SOLID and stock code 5242.
Independent non-executive chairman Chee Ho Chun said, “This marks a new day and a new responsibility for Solid, a new commitment to move forward to scale greater heights of business performance and achieve greater value creation for our business associates as well as our new shareholders.”
On August 19, 2013, Solid launched its prospectus at an official ceremony to mark the opening of the subscription of its initial public offering (IPO), which raises RM19.8 million in gross proceeds from the public issue, and results in a market capitalisation of RM84 million based on the IPO price of RM0.56 per share.
At the close of the application and balloting, Solid’s retail portion comprising 7.5 million new ordinary shares was oversubscribed by 9.83 times.
Out of the proceeds raised, RM12 million will be used for capital expenditure, RM5.3 million for working capital, and RM2.5 million to defray listing expenses.
For the capital expenditure portion, the group has earmarked RM9 million for the acquisition of vacant land in Johor Bahru and/or construction of an integrated operations complex that will house the Group’s corporate office, warehouse as well as production, repacking and packaging facilities.
The remaining RM3 million will be utilised for the construction of the new sales office and warehouse in Kuala Lumpur for a subsidiary company.
Chee continued “According to the Independent Market Research report by Protégé Associates Sdn Bhd, the market size of the automotive aftermarket for parts and components in Malaysia is expected to grow from RM3.61 billion in 2012 to reach RM4.39 billion in 2017 and its compounded annual growth rate for the period 2012 to 2017 is projected to be four per cent.
“With our competitive strengths, future plans and strategies, we are well positioned to capitalise on this favourable market trend and set the platform for our aim to become one of the leading players in the automotive aftermarket for parts and components in Malaysia.”
In closing, Chee said, “We have great confidence in our ability to achieve the Group’s objectives and have mapped out strategies among which includes the centralization of our Group’s operations, expansion of our principal activities, enhancing our in-house product testing capability, expansion of our distribution network, enhancement of our supply chain management and quality system, and the new distributorship of Lucas branded products. All these strategies will enable Solid to achieve and sustain its growth momentum in the future.”
Alliance Investment Bank Bhd is the appointed Principal Adviser, Underwriter and Placement Agent while MainStreet Advisers Sdn Bhd is the Joint Adviser for the listing exercise.