Discount chain Eco-Shop seeks US$97mil in IPO
Eco-Shop plans to use the proceeds from the share sale to add 70 stores per year for the next five years. (Eco-Shop website pic)
KUALA LUMPUR : Malaysian discount retail chain Eco-Shop Marketing Sdn Bhd plans to raise RM419 million (US$96.7 million) in what will be Malaysia's biggest market debut in eight months.
Eco-Shop will look to sell 347 million shares at RM1.21 apiece in a public listing, valuing the company at RM7 billion, according to a prospectus released today.
The company plans to raise an additional RM623 million via a share sale to institutional investors.
Maybank Investment Bank Bhd, a unit of Malaysia's biggest lender, is the sole underwriter of the IPO.
The stock is expected to start trading on May 23.
The dollar-store operator plans to use the proceeds from the share sale to add 70 stores per year for the next five years, essentially doubling its store count, chief executive officer Jessica Ng said during the launch of the prospectus in Malaysia's Selangor state.
'In the current cost environment, our business model has never been more relevant,' she said.
Established in 2003 by Lee Kar Whatt, Eco-Shop sells the majority of items in its stores for RM2.60.
It operates 350 stores across Malaysia and has a market share of 68% in the country's discount-store sector.
Eco-Shop's IPO underlines the strength of Malaysia's consumer sector – which also attracted the country's biggest listing last year in mini-mart chain 99 Speed Mart Retail Holdings Bhd, which raised over US$530 million in Malaysia's biggest IPO in seven years.
Malaysia's consumer spending is expected to see further strong growth in 2025, according to Fitch Solutions' BMI in a recent report.
Household spending is expected to grow 5.2% this year, according to the report, marking a return to pre-pandemic levels of growth.
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