PETALING JAYA: Engineering solutions provider Kawan Renergy Bhd has entered into an underwriting agreement with M&A Securities Sdn Bhd for its upcoming initial public offering (IPO) on the ACE Market of Bursa Malaysia Securitie (Bursa Securities). Kawan Renergy Group, through subsidiaries Kawan Engineering Sdn Bhd and Kawan Green Energy Sdn Bhd, is principally involved in the design, fabrication, installation and commissioning of industrial process equipment, process plants as well as renewable energy and co-generation plants. Its engineering solutions are applicable in a wide range of industries such as food processing, oleochemical and chemical processing, oil and gas, waste recovery, power plant and utilities.

The group is also involved in power generation and sale of electricity through Bercham Plant, a landfill biogas power plant in Ipoh with an installed capacity of 1.2MW of electricity and a net export capacity of 1MW.

Kawan Renergy’s IPO entails a public issue of 110 million new ordinary shares, representing 20% of its enlarged share capital, as well as an offer for sale of 34.5 million existing shares, or 5.3% of its enlarged share capital to selected investors by way of placement and 1% to selected Bumiputera investors approved by the Ministry of Investment, Trade and Industry (Miti).

Kawan Renergy managing director Lim Thou Lai said the IPO exercise will expedite their expansion plans and allow them to tap into the equity capital market, giving them better financial flexibility to capitalise on upcoming opportunities.

“The IPO proceeds will mainly be used as working capital to enable the group to undertake more quality projects, moving up the value chain as well as to strengthen our power generation and sale of energy business,” Lim said, adding that the industrial process equipment industry continues to show promising prospects, supported by the improved demands of various sectors that utilise such equipment.

Kawan Renergy is scheduled to be listed on the ACE Market by the second quarter of this year.