KUALA KETIL: Cable and wire manufacturer Southern Cable Group Bhd proposed a private placement of up to 10% of its total number of issued shares, to fund the group’s multi-year expansion plans to capture increasing opportunities from local and overseas demand for cables and wires.
The expansion, the company said will increase the group’s annual cable and wire output by 25% to 65,000 km/year, from 51,980 km/year as at June 30, 2025. Concurrently, it will triple its aluminium rod production to over 60,000 MT/year, from approximately 20,000 MT/year as at June 30, 2025.
These expansions will be carried out in stages and are targeted to complete by the end of 2027.
Managing director Tung Eng Hai said: “Southern Cable is expanding to meet rising demand for cables and wires, while also playing a role in supporting Malaysia’s development through projects in power utility, renewable energy, construction, infrastructure, and data centres.
To achieve our long-term growth aspirations, we are also increasing our overseas revenue, with a target to have it contribute 30% of total revenue within the next three years. The funds raised will strengthen our manufacturing capabilities and support our vision of becoming a leading integrated cables and wires manufacturer in the region.”
Of the total proceeds to be raised from the proposed exercise, RM129 million will be allocated for capital expenditure and expansion. This will fund the construction and renovation of factories and warehouse adjacent to the group’s existing operations in Kuala Ketil, Kedah, acquisition of a warehouse, as well as the purchase of new machinery and equipment.
The key investments in the expansion include two production lines—one for medium- to extra high-voltage cables and another for medium- to high-voltage cables—in addition to a high-capacity aluminium furnace.
Separately, RM5.1 million will be utilised to settle the balance purchase price of an industrial land previously acquired in July 2025, and related expenses.
The remaining proceeds will primarily be allocated for working capital to purchase raw materials such as copper, aluminium, and plastic compounds, supporting the group’s growing cable and wire production capacity. A portion will also be used for repayment of borrowings and to defray estimated expenses from the proposed exercise.
At an indicative issue price of RM2.16 per placement share, the proposed private placement is expected to raise total gross proceeds ranging from RM218 million to RM259 million under the Minimum Scenario and Maximum Scenario, respectively.
RHB Investment Bank Bhd has been appointed as the principal adviser and sole placement agent for the proposed private placement.
