KUALA LUMPUR – Eco World International Bhd (EWI), which priced its retail offering at RM1.20 per share for its initial public offering (IPO), is optimistic of securing more institutional investors.
President and CEO Datuk Teow Leong Seng said it recently signed cornerstone placement agreements with the Employees Provident Fund Board (EPF), Permodalan Nasional Bhd (PNB) and Kumpulan Wang Persaraan (Diperbadankan) (KWAP).
The three parties have agreed to subscribe for 212.4 million shares in the aggregate, collectively subscribing for 47% of the institutional offering of up to 449.459 million shares.
The IPO comprises 2.153 billion new shares, which make up 89.7% of the enlarged issued and paid-up capital of EWI. The remaining 10.3% is held by Tan Sri Liew Kee Sin.
“The IPO involves strategic investors namely Eco World Development Group Bhd (EW Bhd) and GuocoLand Ltd holding 1.296 billion shares comprising 54% in total; a retail offering of 408 million new shares comprising 17%; and institutional offering of 449 million shares comprising 18.7%,” said Teow.
The retail offering, which closes on March 20, is priced at RM1.20 per share. Of the 408 million shares, 48 million shares representing 2% have been allocated for the Malaysian public.
The price for the institutional offering, which closes on March 21, will be determined by way of book building with a price range of RM1.15 to RM1.20 per share.
According to the prospectus, the final retail price will equal the lower of the retail price of RM1.20 or the institutional price, and bonus issue of two free warrants in EWI for every five EWI shares held after the IPO.
EWI expects to raise gross proceeds of about RM2.6 billion from its IPO, part of which will be used to fund the development of four ongoing projects in the UK and Australia. These projects have a total estimated gross development value of RM12.96 billion.
“Having the IPO now instead of in 2016 is also a blessing for us in many ways. We now have a much more compelling story to tell and a clear earnings visibility over the next four years,” said Teow. EWI is expected to be listed on April 3.
Post listing, the group hopes to seal some land deals in London and Australia, which will be funded with cash left over from the IPO proceeds and borrowings. It will also look at redeveloping some of the hotels operated by GuocoLand in London.