CPE Technology Seeks to Raise RM179.5 Million through IPO

CPE Technology Bhd, an engineering support services provider, is planning to raise RM179.58 million through an initial public offering (IPO) on December 7, 2023. The main objective of the IPO is to support the company’s expansion plans. In a statement, CEO Lee Chen Yeong said that the majority of the capital raised will be used to construct new plants, purchase machinery and equipment, and acquire raw materials to optimize production.

The proceeds from the IPO will also be used to acquire industrial land and construct new plants, purchase new machinery and equipment, repay bank borrowings, provide working capital, cover capital expenditure, and pay for listing process expenses. It is expected that at an issue price of RM1.07 per share and an enlarged issued share capital of 671.31 million shares, the company will have a market capitalization of RM718.31 million.

According to the prospectus, Malaysia’s total engineering support industry (ESI) was worth RM9.98 billion in 2023, up from RM9.37 billion the year before. CPE Technology held a 1.55% share of the 2022 market, generating revenue of RM145.35 million. The company anticipates that the ESI will experience a compounded annual growth rate of 8.2%, reaching RM13.88 billion in 2027. Despite headwinds in the semiconductor industry, CPE Technology remains optimistic about the market’s potential