Reach Ten eyes RM104mil from IPO for telecom expansion
By Nabiha Safian
KUALA LUMPUR: Reach Ten Holdings Bhd is set to raise RM104 million through its initial public offering (IPO) on the Main Market of Bursa Malaysia, scheduled for May 2.
The Sarawak-based telecommunications provider plans to issue 200 million new shares at an IPO price of 52 sen each, aiming for a market capitalisation of RM520 million upon listing, based on an enlarged share base of one billion shares.
Reach Ten intends to allocate RM60 million or 57.7 per cent of the IPO proceeds to enhance its existing fibre optic network in Kuching and to build new fibre optic infrastructures in Miri, Sibu and Bintulu.
Additionally, RM25 million or 24 per cent will be used to construct 100 new 4G or 5G telecommunication towers across Sarawak, with a focus on Miri, Sibu and Bintulu.
The company also plans to invest RM4.3 million or 4.1 per cent to upgrade its satellite-based communications network. This includes the purchase of mobile and fixed satellite terminals, supporting hardware and software, and improvements to its teleport facilities. The remaining proceeds will be allocated for working capital needs, repaying bank borrowings, and covering the estimated expenses of the listing.
Managing director Leo Chin said the company would expand its fibre optic networks, enhance satellite capacities and develop digital solutions to provide seamless connectivity across Sarawak.
He said the IPO proceeds will enable it to further expand its existing fibre optic communication networks infrastructure in Kuching as this will enable it to reach underserved or newly developed areas, attracting new customers and thereby increasing its market share.
"In addition, building upon our experience in establishing our fibre optic communication networks infrastructure in Kuching and Samarahan, we intend to establish three new fibre optic communication network infrastructure in Miri, Sibu and Bintulu over the next three to four years, to meet customers' demands and to capture future business growth opportunities," he said in a statement.
Reach Ten owns and operates a fibre optic communication network infrastructure in Kuching and Samarahan, spanning approximately 217 kilometres of fibre optic duct infrastructure and 649km of fibre optic cable link communication networks, which took nearly 14 years to develop.
Over the past two decades, Reach Ten had participated in numerous government initiatives, including Jendela, a nationwide programme to enhance broadband coverage and quality.
Other projects included the Sarawak Multimedia Authority Rural Telecommunication, aimed at expanding connectivity in remote regions, and the Saluran initiative, which ensured reliable communication networks across Sarawak.
For the 10-month financial results ended Oct 31, 2024, Reach Ten registered RM65.4 million net profit on the back of RM153.1 million turnover. The net profit achieved in the period under review has outperformed 2023's full-year results.
For the financial year of 2023, the company posted RM51.3 million net profit and a turnover of RM182.3 million. Under the listing exercise, Reach Ten is issuing 200 million new shares and an offer for sale of 100 million existing shares, representing 20 per cent and 10 per cent of the enlarged share capital of Reach Ten respectively.
Of the 200 million issue shares, 50 million new shares will be made available to the Malaysian public via balloting and 25 million new shares for its eligible directors, employees and persons who have contributed to the success of Reach Ten Group under the pink form allocations.
The remaining 125 million issue shares will be placed out to selected bumiputera investors approved by the Ministry of Investment, Trade and Industry. For the offer-for-sale portion, 100 million existing shares are reserved for private placement to selected investors.
M & A Securities Sdn Bhd is the principal adviser, underwriter and placement agent for the IPO exercise. The IPO is open for subscription from today to April 18, 2025.
Source : reach-ten-eyes-rm104mil-ipo-telecom-expansion
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