Kuala lumpur: LEAP Market-listed Enest Group Bhd is set to raise RM15.11 million through its initial public offering (IPO) as it transitions to the ACE Market of Bursa Malaysia Securities Bhd. The funds will primarily be directed towards repaying bank loans, enhancing working capital, and covering listing expenses.
According to BERNAMA News Agency, the company's chief financial officer, Christopher Tan Yew Leong, stated that the bank borrowings were utilized mainly for acquiring two factory properties in Sepang and Kajang, Selangor, classified as investment properties. The group is also focusing on developing a new facility in Kajang for in-house manufacturing of bottled bird's nest products and other health beverages, with an anticipated annual capacity of approximately 300,000 bottles.
Tan highlighted the acquisition of two factories as part of the group's expansion strategy. The Sepang facility will support the raw unclean bird's nest (RUBN) trading business, while the RM12 million Kajang factory will process edible bird's nests and produce bottled bird's nest products. The construction of the Kajang facility is expected to be completed in 2027, with operations commencing by late 2028 or early 2029, pending necessary approvals for exports to China from the General Administration of Customs (GACC).
Enest is also aiming to expand its customer base in China, focusing on distributors and buyers in the health and wellness sector, while increasing its RUBN exports to the Chinese market. The IPO, priced at 13 sen per share, is expected to generate proceeds of RM5 million for bank debt repayment, RM6.41 million for working capital, and RM3.70 million for listing expenses.
The IPO consists of a public issue of 116.25 million new ordinary shares, representing 20% of the group's enlarged issued share capital of 581.25 million shares, alongside an offer for sale of 15.05 million existing shares, accounting for approximately 2.6% of the enlarged issued share capital.
Enest's chief operating officer, Lok Chyi Yeu, stated that the group is actively seeking to increase its export quota to China, with the current quota at about 18 tonnes. An additional increase of around two tonnes is anticipated this year, potentially raising total export capacity to approximately 20 tonnes. He mentioned that bird's nest exports to China require quota approvals and regulatory audits by Chinese authorities, and the group is working with regulators to secure higher allocations over time.
Lok also noted that the group is expanding its presence in both China and the domestic market through RUBN trading and downstream activities. He clarified that their China operations are concentrated on import and distribution through local partners and wholesalers, rather than managing physical retail stores.
He assured that the group's operations are not directly affected by geopolitical tensions, as it relies on air freight and maintains long-term agreements with logistics partners, allowing for effective management and stabilization of logistics costs.
The IPO is open for subscription now and will close on July 2, 2026, with the company's listing on the ACE Market scheduled for July 15, 2026. MandA Securities Sdn Bhd is serving as the adviser, sponsor, underwriter, and placement agent for the IPO.