Unitrade, one of Malaysia's biggest building materials distributors, heads for Bursa listing

Unitrade, one of Malaysia's biggest building materials distributors, heads for Bursa listing

Unitrade Industries Bhd, one of Malaysia’s largest homegrown building materials wholesalers and distributors, is heading for a listing on Bursa Malaysia’s ACE Market.

KUALA LUMPUR: Unitrade Industries Bhd, one of Malaysia's largest homegrown building materials wholesalers and distributors, is heading for a listing on Bursa Malaysia's ACE Market.

Unitrade today entered into an underwriting agreement with M & A Securities Sdn Bhd in conjunction with its initial public offering (IPO).

Its IPO  involves a public issue of 312.5 million new shares, representing 20 per cent of its enlarged share capital, as well as an offer for sale of 125.0 million existing shares.

Out of the 312.5 million new shares, 78.1 million shares will be made available to the public via balloting, 63.5 million shares to its eligible directors, employees, and persons who have contributed to its success (pink form allocations), and 53.7 million shares for private placement to selected investors.

The remaining portion of 117.2 million shares is reserved for Bumiputera investors approved by the Ministry of International Trade and Industry (Miti), which will also be done via private placement.

Of the 125.0 million shares under offer for sale, 78.1 million shares will be offered via private placement to Miti-approved Bumiputera investors, and 46.9 million shares will be placed out to selected investors.

M&A Securities will underwrite 141.6 million new shares, comprising portions for the public and pink form allocations.

Selangor-based Unitrade is scheduled to be listed by May 2022.

The company carries an extensive range of 6,319 stock-keeping units such as pipes, valves, fittings, and accessories for mechanical and electrical (M&E) works, as well as steel products, and other building materials for civil works.

It has a vast network of local and overseas suppliers that totals around 483.

The company serves 1,232 active customers encompassing M&E contractors, building contractors, as well as traders, manufacturers, and retailers.

Unitrade is also involved in the manufacturing and sale of pre-insulated pipes and provides rental of temporary structural support equipment for building construction activities.

Managing director Nomis Sim Siang Leng said the underwriting agreement marked the beginning of the final leg in its listing journey.

"The exercise comes with multifaceted benefits beyond the estimated RM100.0 million proceeds to be raised. The listing status will enhance our brand exposure and Unitrade's stature in the eyes of our lenders, customers, and suppliers, which could improve our credit and financing options."

Sim said it had recently consolidated its operations under a new industrial complex which houses its headquarters, warehouse and factory facility.

"With that, we have managed to enhance our operational efficiency and reduce our carbon footprint. The new warehouse is measured at 281,000 square feet and is double the size of our previous one, giving us the ready capacity to increase our inventories to meet the upcoming surge in demand for building materials. Accordingly, we will deploy a portion of the IPO proceeds to boost our working capital, allowing us to swiftly ramp up our volume and capitalise on the opportunities."

Unitrade is scheduled to be listed by May 2022.

https://www.nst.com.my/business/2022/04/786664/unitrade-one-malaysias-biggest-building-materials-distributors-heads-bursa