CPE Technology Bhd, an engineering support services company, is planning to raise RM179.58 million through an initial public offering (IPO) on December 7, 2023. The main goal of the IPO is to support the company’s expansion plans. In a statement, CEO Lee Chen Yeong said that most of the capital raised will be used to construct new plants, purchase machinery and equipment, and acquire raw materials to optimize production.
One of the key uses of the proceeds from the IPO will be to acquire industrial land and construct new plants, as well as to purchase new machinery and equipment. Additionally, part of the funds will be allocated to repay bank borrowings, provide working capital, cover capital expenditure, and pay for expenses associated with the listing process. It is expected that at an issue price of RM1.07 per share and an enlarged issued share capital of 671.31 million shares, CPE Technology will have a market capitalization of RM718.31 million.
According to a prospectus released by CPE Technology Bhd in Malaysia’s total engineering support industry (ESI) was worth RM9.98 billion in 2023, up from RM9.37 billion in 2022. The company holds a 1.55% market share in 2022 and generated revenue of RM145.35 million that year. CPE Technology anticipates that the ESI will experience a compound annual growth rate of 8.2%, reaching RM13.88 billion by 2027 despite headwinds in the semiconductor industry, it remains optimistic about market potential