KUALA LUMPUR (Aug 28): Building management systems company Solar District Cooling Group Bhd on Wednesday launched its initial public offering (IPO) on the ACE Market which would raise RM45.09 million.

The IPO, priced at 38 sen per share, involves a public issue of 118.67 million new shares, according to the official prospectus. There is no separate tranche for sale of existing shares. All in all, the listing offers investors up to a 28% stake in the company.

Application for the IPO shares will close on Sept 6, and listing has been scheduled for Sept 19.

Solar District specialises in building management systems, solar thermal solutions, and energy-saving services. The company also undertakes system and equipment maintenance projects comprising gas fired chillers and chilled water systems.

The company’s top customers are a concession company, a construction company, a facilities management company and a building owner, which together account for more than half of its total revenue for the financial year 2023 (FY2023).

Under the public issue, the company is allocating 21.19 million new shares to the Malaysian public and 21.19 million shares to eligible persons. Solar District is also offering 76.28 million new shares to select investors through private placement.

The company has earmarked about 41.5% of the proceeds to purchase materials, 28.1% for general working capital, 11.1% for tender bonds for future projects, 9.5% for listing expenses, 5.6% for capital expenditure and 4.2% for headquarters expansion.

Solar District managing director Edison Kong currently controls 90% of the company's share capital, and executive director Eileen Liuk holds the remaining 10%.

Post-IPO, Kong's stake will be diluted to 64.8% and Liuk's holdings will be trimmed to 7.2%.

Mercury Securities Sdn Bhd is the IPO’s principal adviser, sponsor, underwriter and placement agent.