SINGAPORE (THE BUSINESS TIMES) - LHN Logistics lodged a preliminary offer document on Wednesday (March 30) as its parent company, property player LHN, seeks its spin-off and listing on the Catalist board of the Singapore Exchange (SGX).
The document states that part of the gross proceeds raised from the placement will go towards the logistics services group's plans to increase its scale of operations by growing its transport fleet.
LHN Logistics intends to buy at least 20 additional prime movers and at least 70 trailers to better support customers who require cross-border transport services between Singapore and Malaysia. The acquisition will be made progressively over a period of two years from this year, the document stated.
The rest of the proceeds will go towards expansion plans.
These include plans to build an ISO tank depot at its logistics property in Gul Avenue, which will provide chemical cleaning and repair services for ISO tanks, empty ISO tank storage services, and laden ISO tank storage services for hazardous substances and petroleum and flammable materials.
This will further expand and enhance LHN Logistics' value-added transport services, said the document.
An ISO tank is an international intermodal container manufactured according to the specifications outlined by the International Organisation for Standardisation. ISO containers are suitable for use on ships, trains and trucks.
There are also plans to expand the group's business to more countries in the Asean region as and when opportunities arise, be it in the setting up of new subsidiaries, acquisitions, joint veneers or strategic alliances, the document said.
"We believe that these avenues of expansion will give us access to new markets and customers as well as new businesses," it added.
As LHN Logistics is already undertaking preparatory works to establish an overseas container depot in Yangon, Myanmar, the document included a clarification that it does not intend to utilise any of the placement proceeds for expansion into Myanmar.
PrimePartners Corporate Finance is listed as LHN Logistics' sponsor, issue manager and co-placement agent. CGS-CIMB Securities (Singapore) is the other placement agent.
The development follows LHN's applications to the stock exchanges of Hong Kong and Singapore last November to spin off and separately list the shares of LHN Logistics.
Apart from the logistics business, which comes under LHN Logistics, LHN houses two other business segments, centred on space optimisation and facilities management. All three segments are separate and distinct.
If the proposed spin-off is successful, LHN will continue to hold majority shareholding in LHN Logistics, which will continue to be consolidated with the group, LHN had said.
Shares of LHN closed up three cents, or 9.1 per cent, at 36 cents before the announcement.
