Perwaja plans to raise RM175m

PERWAJA Holdings Bhd, a 51 per cent subsidiary of Kinsteel Bhd, plans to raise about RM175 million from its initial public offering (IPO).

It is expected to make its debut on the main board of Bursa Malaysia by September and Kinsteel's shareholders are being offered cheaper Perwaja shares.

"Kinsteel minority shareholders can buy Perwaja shares at RM2.23. This is a 67 sen, or 23 per cent, discount to the RM2.90 IPO price," said Kinsteel's managing director Tan Sri Pheng Yin Huah.

Some RM100 million raised from Perwaja's share sale to the public will be used for Kinsteel's working capital.

Perwaja is issuing 150 million shares under the IPO. This comprises 60 million new shares and 90 million existing shares to be offered collectively by Kinsteel and Maju Holdings Sdn Bhd.

Of the total shares, 101.5 million will be offered at the discount price of RM2.23 a share. The rest will be priced at RM2.90.

Perwaja's controlling shareholders, Kinsteel and Maju, recently signed an underwriting agreement with RHB Investment Bank, Affin Investment Bank, AmInvestment Bank and OSK Investment Bank.

Perwaja is capable of producing 1.5 million tonnes of direct-reduced iron, 1.3 million tonnes of billet, beam-blanks and blooms in a year.