99 Speed Mart targets 9.9 market debut as Malaysia’s biggest IPO in seven years, aims to raise RM2.36b

SHAH ALAM, Aug 15 — Mini-market retail chain 99 Speed Mart Retail Holdings Bhd will give a huge boost to the retail sector, in what will be Malaysia’s biggest initial public offering (IPO) in seven years, raising RM2.36 billion for its Main Market listing on September 9.

According to the prospectus, the IPO is priced at RM1.65 apiece and has attracted 14 cornerstone investors including Malaysia’s government-linked investment companies and asset managers, whose support covers 55 per cent of the IPO size.

The deal involves an offer for sale of 1.03 billion existing shares and a public issue of 400 million new shares. The institutional tranche comprises 1.22 billion shares via bookbuilding and 210 million shares have been allocated to retail investors.

The public issue will raise about RM600 million and offer for sale to gross about RM1.7 billion.

Alternate director Albert Lee Yan Zhong said RM389.0 million, or 58.9 per cent from the public portion will be used to expand its network of outlets, and RM100 million (15.2 per cent) to set up distribution centres.

“We will set aside 8.3 per cent (RM55.0 million) to purchase delivery trucks, RM47.6 million to upgrade existing outlets and to procure energy-efficient equipment, and RM45.0 million to pare down the group’s existing borrowings, with the remaining RM23.4 million to cover listing expenses,” he said at a press conference to launch the company’s prospectus today.

99 Speed Mart is eyeing a geographical expansion of its outlets, with a target of 3,000 outlets in 2025 from the current 2,651 nationwide.

“There are opportunities in the East Coast region. We have only seven outlets in Terengganu and have opened a distribution centre in Gambang, Kuantan to support our outlets in Terengganu.

“We have yet to enter Kelantan. We plan to open six more distribution centres to support our growth plans,” he said, adding that there are currently 19 distribution centres nationwide.

Lee said the retail chain launched “99 Bulksales” last year to tap into the retail and enterprise markets, allowing customers to purchase in bulk online.

The segment is still preliminary, contributing RM1 million monthly sales to the group’s earnings.

“We introduced the segment last year, targeting the central peninsular. We expanded it to the southern part of Malaysia and are consistently looking to expand the service, although we need to evaluate the logistics aspects,” he added.

Regarding its international market expansion, Lee explained that the company established Yiwu Speed Mart Import and Export and Yiwu J-Jade Trading in China to handle procurement activities.

The 99 Speed Mart IPO is reportedly South-east Asia’s biggest in over a year since Indonesia’s Amman Mineral Internasional’s listing in July 2023.

Deloitte’s 2024 South-east Asia Mid-Year IPO Snapshot report said Malaysia raised US$450 million (RM1.9 billion) in the IPO capital market, or 33 of the region’s US$1.4 billion raised in the first half of 2024. — Bernama

*Editor’s note: An earlier version contained a misspelling to the surname of alternate director Albert Lee Yan Zhong who was attributed as Albert Lew Yan Zhong. It has since been corrected.