Procurri lined up for Mainboard IPO of 68.88 million shares at 56 cents

Sean Murphy (left), global CEO of Procurri.
Sean Murphy (left), global CEO of Procurri.PHOTO: BUSINESS TIMES FILE

SINGAPORE - Procurri has launched its initial public offering, taking another step towards its Mainboard listing on the Singapore Exchange.

With its prospectus registered on Tuesday (July 12), the IT hardware and service provider announced its offer of 68.88 million shares - including 6.88 million shares for the public offer - at 56 Singapore cents apiece.

The IPO plans to raise around S$34.6 million in net proceeds to build up Procurri's war chest for future acquisitions.

No fixed dividend policy was highlighted, but the management intends to recommend and distribute 25 per cent of the net profit for financial years 2016 and 2017.

The company has three main business pillars - the resale of excess data centre equipment, the lifecycle maintenance service for its clients, and the disposition of IT assets.

Frost & Sullivan forecasts have put the global combined market of these three areas at over US$50 billion (S$67.4 billion) in 2020, on a compound annual growth rate of around 15 to 21 per cent, chief executive Sean Murphy said in a media briefing on Tuesday.

Yet this market does not yet have a dominant player, and Procurri - with hubs in Britain, the United States and Singapore where it's headquartered - has the advantage to be the first to have a global platform and a focus on Asia, where the market growth rates outpace that of the world, Mr Murphy added.

Between 2013 and last year, Procurri's revenue grew at a compound annual rate of 108 per cent to S$122.8 million, while net profit grew 112 per cent to S$8.8 million.

With the IPO proceeds, Procurri plans to acquire more firms to build up the service segment of its business. The service-related profit is just 34 per cent of the group's total, but has a high profit margin of above 50 per cent.

Procurri's IPO is set to be first non-trust new listing on SGX' Mainboard this year. It also marks the first successful "spin-off" of Catalist-listed DeClout. DeClout is an incubator of tech firms, and will continue to own 46.5 per cent of Procurri post-listing.