SPRING ART EXPECTS TO RAISE RM24.42 MLN FROM IPO

KUALA LUMPUR, Oct 16 -- Ready-to-assemble furniture products designer and manufacturer, Spring Art Holdings Bhd expects to raise RM24.42 million under its proposed listing on the ACE Market of Bursa Malaysia Securities Bhd.

Managing Director Jack Lim Kok Eng said of the total proceeds, 71.9 per cent or RM17.55 million would be utilised to acquire new machinery to set up two additional production lines for its new manufacturing factory, namely Factory C.

The remaining RM3.67 million (15 per cent) would be spent on general working capital requirements, while RM3.20 million (13.1 per cent) is to be used to defray listing expenses for the initial public offering, he added.

He also said Factory C would enable Spring Art to expand its current manufacturing capacity to 674,000 units per annum from 337,016 as at Sept 17, 2019.

"We expect to commence operations at this new manufacturing factory in July 2022," he said at the launch of the company's prospectus here today.

Lim said Factory C, with a built-up area of about 103,926 sq ft, would undertake the manufacture of office, bedroom and living room furniture among others, for export to North America, Europe and existing customers.

At present, Spring Art supplies its ready-to-assemble furniture products to distributors, furniture showroom retailers, home furnishing chain stores and e-commerce companies from 35 countries such as India, Japan, the United Arab Emirates, Saudi Arabia, Canada and Bahrain.

Lim said 100 per cent of the company's sales were from the overseas market, with North America contributing a 2.1 per cent share.

Spring Art's listing on the ACE Market of Bursa Malaysia is scheduled for Nov 8, 2019 at an offer price of 25 sen per share.

-- BERNAMA