KUALA LUMPUR, 6 August 2024 – Elridge Energy Holdings Berhad (“EEHB”) unveiled its initial public offering (“IPO”) prospectus today in conjunction with its proposed listing on the ACE Market of Bursa Malaysia Securities Berhad (“Bursa Securities”).
The IPO shall entail a public issuance of 350,000,000 new ordinary shares of EEHB (“ Issue Shares”), which comprises 80,000,000 Issue Shares representing the portion made available to the Malaysian public via balloting; 20,000,000 Issue Shares to be allocated to eligible directors, employees as well as person who have contributed to the success of the Group and 250,000,000 Issue Shares will be allocated to Bumiputera investors, identified and approved by the Ministry of Investment, Trade and Industry, Malaysia.
An offer for sale of 350,000,000 existing ordinary shares of EEHB (“Offer Shares”) will be made available to selected investors by way of private placement.
Through the public issue portion of its IPO, EEHB targets to raise approximately RM101.5 million, in which RM47.0 million will be utilised for the land acquisition and construction of a new factory and warehouse in Kuantan and RM21.1 million will be used for the purchase of new machinery and equipment. Meanwhile, RM27.0 million will be utilised as working capital. The remaining RM6.3 million will be allocated to finance listing expenses.
Based on an issue price of 0.29 sen per share and enlarged share capital of 2,000,000,000 shares, EEHB will have a market capitalisation of RM580.0 million upon listing.
Oliver Yeo, Executive Director and Chief Executive Officer of EEHB, said, “The increasing global push for renewable energy sources has led to a rising demand for biomass fuel products, particularly in Asia Pacific. Malaysia, with its abundant natural forestry resources and a strong agricultural sector fueled by fertile soil and a tropical climate, stands out as a major supplier of biomass fuel products such as palm kernel shells and wood pellets. The positive market outlook underscores the potential for biomass fuel products, which are recognised for their energy efficiency and environmental benefits, to contribute substantially to global energy needs and environmental goals.”
According to the Independent Market Research report by Providence, the palm kernel shells industry in Asia Pacific is forecast to grow at a CAGR of 8.9% from an estimated USD308.6 million (RM1.4 billion) in 2024 to USD366.1 million (RM1.7 billion) in 2026, while the wood pellets industry in Asia Pacific is forecast to grow by a further CAGR of 8.6%, from USD10.6 billion (RM48.4 billion) in 2024 to USD12.5 billion (RM57.1 billion) in 2026.
“As a market leader in the production of high-quality biomass fuel products that reduce net greenhouse gas emissions, we are poised to capitalise on the burgeoning market for sustainable and eco-friendly renewable energy solutions. This listing exercise is crucial for EEHB, as it presents a valuable opportunity to enhance our capabilities and further bolster our presence in the region. It also allows us to create value for our stakeholders and enables us to tap into a new customer base, while maintaining our industry-leading position in terms of product quality.”
Ahmad Fazlee Aziz, Co-Head/Director, Corporate Finance of KAF Investment Bank Berhad, said, “We believe that EEHB, through its subsidiary Bio Eneco Sdn Bhd, has the capability to manufacture high-quality biomass fuel products required to become the leading player in the Asia Pacific market. The IPO exercise will undoubtedly accelerate its growth and enhance its industry and corporate reputation even more. We are pleased to be part of the Company’s growth journey.”
EEHB is an investment holding company and via its wholly-owned subsidiary, Bio Eneco Sdn Bhd, the Group specialises in the manufacturing and trading of biomass fuel products, with a focus on palm kernel shells and wood pellets. Currently, the company’s customers are based in Asia Pacific, mainly comprising Malaysia, Singapore, Indonesia and Japan.
In conjunction with the launch, the application period of EEHB’s IPO is made available from today and will close at 5.00pm on 12 August 2024.
KAF Investment Bank Berhad is the Principal Adviser, Sponsor, Underwriter and Placement Agent for this IPO exercise.
