Kuala lumpur: Industrial chemicals distributor Eckem Holdings Bhd seeks to raise RM15 million from its initial public offering (IPO) in conjunction with its listing on the ACE Market of Bursa Malaysia Securities Bhd, scheduled for July 3, 2026.
According to BERNAMA News Agency, the IPO comprises a public issue of 125 million new ordinary shares at an issue price of 12 sen per share, as stated by the group in a statement in conjunction with the prospectus launch. The proceeds will be allocated to several strategic areas, including RM6 million for constructing a new corporate office, warehouse, and laboratory to bolster operational infrastructure. Additionally, RM2 million is designated for expanding a new production line in the rubber products segment to enhance manufacturing capabilities.
Eckem Holdings plans to allocate RM1.45 million for repaying bank borrowings to optimize its capital structure and RM1.75 million for working capital requirements to support ongoing business operations. Furthermore, RM3.8 million will cover listing expenses.
Executive director Jack Tan expressed cautious optimism amid the United States-Iran conflict affecting the global petrochemical supply chain. He stated that despite the disruption, the company aims to increase production capacity by adding another manufacturing line and intends to proceed with this plan despite supply challenges.
On the distribution front, Tan revealed ongoing discussions with several new brands the group plans to represent in Malaysia and Singapore, anticipating positive outcomes as early as this year and expecting a significant impact by 2027.
Addressing industry challenges, Tan highlighted issues such as price dumping from China, which the management is taking seriously since most represented brands are from European countries. The company is considering adding quality Chinese products to its portfolio to balance the market dynamics.
Tan also noted potential price increases for the company's products, which could pressure margins if higher costs are not passed on to customers. The company aims to maintain a constant supply from suppliers while ensuring healthy margins and continuing to provide quality products despite the crisis.
Applications for the IPO open today and will close on June 19, 2026, at 5 pm, with MandA Securities acting as the adviser, sponsor, underwriter, and placement agent for the IPO exercise.