Malaysia's Big Caring opens IPO books, seeking up to $2 billion valuation

what happened

Big Caring Group, a Malaysian pharmacy operator with more than 600 outlets, has opened its initial public offering, according to Reuters. The company is offering up to 1.9 billion shares at no more than 1.08 ringgit apiece. At that top price, the company would be worth roughly 8 billion ringgit, or about $2 billion, based on an enlarged base of 7.4 billion shares. The listing on Bursa Malaysia is planned for November 19.

Of the new shares, 590.5 million are primary issuance expected to bring in around 637.8 million ringgit, while 1.3 billion existing shares will be sold by current holders. Most of the primary proceeds, 89.5%, will go to repaying bank loans within three months of the listing. Another 4.7% is earmarked for a distribution centre within 36 months. The company also aims to pay out up to 50% of profit attributable to owners, depending on cash, debt and capex needs.

why it matters

Large regional IPOs like this one show how much appetite there is for Southeast Asian consumer names. A sizeable commitment of 665.5 million shares from 19 investors signals institutional backing before trading begins. For those following Bursa Malaysia, the deal is more a gauge of listing demand than a force that will move the market itself.

market impact

Bursa Malaysia: a large listing may shape demand for new issues in the local market.

tags

instruments