“From left) MMIS head of corporate finance Dr Jeffrey Chin Fook Kheong, executive director Low Oo Seng, Loh, executive director Loh Chin Siang, operations manager Chew Lai Wei, and Sierac Corporate Advisers Sdn Bhd executive director Teh Sew Hong posing at the launch of the Information Memorandum in conjunction with the proposed listing of MMIS on Friday.
KUCHING: MMIS Bhd (MMIS, which is seeking to list its shares on the Leading Entrepreneur Accelerator Platform (LEAP) Market of Bursa Malaysia Securities Berhad in August 2019, is targeting to raise RM5 million from new share issuance.
MMIS is principally involved in the manufacturing, marketing and sale of precision engineering parts, which is mainly sold to manufacturers of semiconductor manufacturing equipment as well as manufacturers of automated testing equipment for the semiconductor industry.
According to its information memorandum that was launched yesterday, under the maximum scenario, the company plans to issue up to 50 million new shares pursuant to the proposed listing, representing approximately 10 per cent of its enlarged issued share capital, at an indicative price of 10 sen per share to sophisticated investors.
Of the funds raised, MMIS plans to utilise RM2 million for capital expenditure; and RM2 million for working capital; with the remaining RM1 million to be used to pay listing-related expenses.
Under the minimum scenario, assuming 20 million new shares are issued, the RM2 million raised will be utilized to finance the capital expenditure RM1.1 million and to pay listing-related expenses.
MMIS managing director Loh Chin Soon stated that the purpose of the listing exercise is for the company to tap into the capital market for future fundraising to pursue growth opportunities, gain recognition and enhance the company’s stature, increase market awareness of the company’s services and expand its customer base.
“Our production capacity presently operates at an average utilisation rate of approximately 73 per centwhile our production floor space is fully utilised. The plan to construct a new facility with an estimated built-up area of 27,000 sq ft is expected to be completed by mid-2020.
“The plan to amalgamate both production facilities will increase the built-up area by 7,200 sq ft and the total current production space from 32,400 sq ft to 66,600 sq ft, by the end of 2020,” he said in a statement yesterday.
“We intend to leverage on our capabilities, technological know-how and proven track record to further expand our range of offerings to our existing customers, and to acquire new customers via targeted sales and marketing activities. Since we have existing customers in the medical and engineering industries, we believe that we can expand our product and service offerings in these new market segments,” he added.
Sierac Corporate Advisers Sdn Bhd has been appointed as the approved adviser, custodian and placement agent by MMIS for the proposed listing.
Commenting on industry prospects, Loh said that precision engineering parts can be used across multiple industries such as semiconductor, electronics packaging, oil and gas, power generation, medical, engineering as well as automotive industries.
“The precision engineering industry in Malaysia has also shown an increase from RM4 billion in 2010 to RM7.1 billion in 2018 at a compound annual growth rate (CAGR) of 7.4 per cent.
“The growth of the precision engineered industry in Malaysia will be supported by demand for precision engineered parts by end user markets such as the manufacturing sector and the global market for the production of electronic products.”
For the financial year ended June 30, 2018, MMIS registered a revenue of RM17.02 million, an 82 per cent increase from RM9.34 million posted in the previous financial year. Its profit before tax for FY2018 was RM5.27 million, 207 per cent higher than RM1.71 million registered in the last financial year.