SINGAPORE - Eindec Group, a regional environmental and technological solutions provider, launched an initial public offering on the Catalist board on Wednesday, the first on the junior board in 2016.
Eindec will issue 35.8 million new shares at 21 cents each. Following the IPO, these new shares will represent 33.2 per cent of the group's resulting share capital of 107.7 million shares. Gross proceeds of the placement are expected to be about S$7.5 million.
The offer document was registered on Wednesday and listing and trading of Eindec's shares on the Catalist is expected to commence at 9am next Friday (Jan 15). There is no retail tranche offered.
Upon completion of the placement, Eindec's market capitalisation is expected to be about S$22.6 million.
Eindec plans to use the estimated net proceeds of about S$4.6 million for the establishment of a new business for environmental and technological solution products in China. It also hopes to invest in research and development and enhance manufacturing capabilities.
Executive director and chief executive Paul Chia said in a statement that Eindec will diversify into the air purifier market by leveraging on its expertise in clean room equipment.
The group estimates the market size for the air purifier industry in China to be about 10.3 billion yuan to 12.6 billion yuan in 2014. Demand growth for consumer air purifiers in China is expected to achieve a compounded annual growth rate of 30.2 per cent from 2014 to 2017, it said.
Mr Chia said that the worsening air quality in larger cities, the growth of the urban population, and the increasing affluence of the middle class would likely create a healthy demand for air purifiers in China.
Headquartered in Singapore, Eindec has been in the business of selling clean room equipment and heating, ventilation, and air conditioning equipment since 1984. Its facilities in Singapore and Malaysia design, install and test products. In 2014, the group's net profit was S$1.4 million on a revenue of S$14.3 million. Its net profit for the first half of 2015 was about S$400,000 and revenue was S$6.6 million.
UOB Kay Hian is the issue manager, sponsor, and placement agent for the IPO.