SINGAPORE (July 17): Mechanical and electrical (M&E) engineering services provider DLF Holdings has registered its offer document with the Singapore Exchange (SGX) for its initial public offering (IPO) on the Catalist board.
DLF is expected to raise gross proceeds of $4.3 million in the IPO, which will see 18.5 million new shares up for grabs at 23 cents each. This will give DLF a market capitalisation of approximately $27.9 million.
The gross proceeds will mainly be used for general working capital purposes and to explore opportunities in mergers and acquisitions, joint ventures, and strategic alliances.
Helmed by executive chairman Manfred Fan and chief executive officer Wong Ming Kwong, DLF says it has seen steady growth over the last three financial years.
In the FY17 ended December, revenue rose 15% to $21.5 million, from $18.7 million a year ago.
Earnings jumped 72% to $3.4 million in FY17, from $2.0 million a year ago.
As at end-FY17, cash and cash equivalents stood at $0.4 million.
In order to further strengthen its market position, DLF aims to secure more projects for both its Project Management Services (PMS) and Turnkey Contracting Services (TCS) segments.
Under its PMS segment, DLF provides M&E engineering services and solutions in fire protection systems, plumbing and sanitary systems, and heating, ventilation and air-conditioning systems. Its customers include main contractors, property developers, five-star luxury hotels, statutory boards, listed companies, and government bodies.
Under the TCS segment, the group typically acts as the main contractor on projects which include the construction of new buildings and additions and alterations (A&A) works, refurbishment, and upgrading of existing buildings.
DLF’s completed projects include works on Esplanade – Theatres by the Bay and Sengkang General and Community Hospital last year.
The group is currently working on a project in the Maldives, which involves building works for lagoon villas, lagoon club, a spa, and restaurant.
It is also engaged in other M&E and piping works at Nee Soon Camp, Sheraton Towers Singapore Hotel, The Tanglin Club, The Pan Pacific Hotel, and The Plaza.
DLF’s order book for its PMS and TCS segments currently stand at approximately $2.6 million and approximately $3.8 million, respectively.
According to DLF, Singapore’s fast-growing population and the continued growth of Singapore’s tourism and hospitality sector will create more business opportunities for the group locally.
Meanwhile, it plans to ride on Asia’s booming tourism growth in recent years to build its international business prospects.
“Our listing on the SGX will help us to expand our business and elevate our company profile. In addition to organic growth through securing more projects, we will also be looking at M&A opportunities to increase our scale and scope,” says Wong.
After the completion of the placement, Fan and Wong are expected to remain as DLF’s controlling shareholders, holding 42.1% and 37.2% of its total issued share capital, respectively.
The placement will close at 12 noon on July 23, 2018.
The listing and trading of the company’s shares on the Catalist board is expected to commence on a “ready” basis at 9am on July 25, 2018.
PrimePartners Corporate Finance is the sponsor, issue manager and placement agent.