KUALA LUMPUR (May 15): After a failed merger with Kajang-based stockbroking firm JF Apex Securities Bhd, Mercury Securities Group Bhd (MSGB) is now looking at a potential initial public offering (IPO) on the ACE Market of Bursa Malaysia.
A check on Bursa's website showed that MSGB — controlled by veteran stockbroker Chew Sing Guan — filed its prospectus exposure with the bourse on May 10.
The IPO may comprise a public issuance of 157.095 million new shares, including 44.65 million shares made available for the Malaysian public, 22.32 million shares for eligible directors and employees, 45.47 million shares by way of private placement to selected investors, and 44.65 million shares by way of private placement to selected bumiputera investors.
The IPO may also include an offer for sale of 71.51 million existing shares, of which 66.97 million shares would be placed out to selected bumiputera investors, and the remaining 4.53 million shares placed out to other selected investors.
The IPO price has yet to be fixed, but MSGB's share base would be expanded to 893 million shares upon listing.
Public Investment Bank Bhd is set to be its principal adviser, sponsor, sole underwriter and placement agent.
Nevertheless, it should be noted that the prospectus exposure published on Bursa has not yet been registered with the exchange under Rule 3.12A of the ACE Market Listing Requirements and it is solely for the purpose of seeking comments from the public.
"These prospectuses should not be used for making any investment decision. Securities cannot be offered and application for securities cannot be accepted until the prospectus has been registered with the exchange," Bursa stressed.
Under the new regulatory regime effective Jan 1, Bursa is now a one-stop centre for all ACE Market IPO approvals.
MSGB is a licensed 1+1 broker involved in the provision of stockbroking and corporate finance advisory services. Its operational offices are located in Penang, Kuala Lumpur, Melaka, Johor and Sarawak.
Through its wholly-owned Mercury Securities Sdn Bhd (MSSB), MSGB is principally engaged in stockbroking, corporate finance advisory and other related businesses. Through Mercsec Tempatan and Mercsec Asing, the securities firm is also engaged in the provision of nominee and custodian services.
MSGB saw its revenue almost double from RM31.52 million in the financial year ended Oct 31, 2019 (FY19) to RM61.01 million in FY21. The stockbroking segment contributed to two-thirds of the group's turnover, while the remainder came from its corporate finance division.
Commenting on its competitive advantages, MSGB said it has an established track record of 30 years in the provision of stockbroking services since 1992, as well as nine years of track record in the provision of corporate finance advisory services since 2013.
"This has enabled our group to strengthen our market position and develop an established customer base for our stockbroking business as well as corporate finance advisory services," it said.
In April last year, the proposed merger between JF Apex and MSSB fell through after dragging on for more than two years. No reason was mentioned for the decision to discontinue with the merger plan.
But those who had been following the JF Apex-MSSB saga should know that the merger was put into question by lawsuits from minority shareholders Concrete Parade Sdn Bhd and Pinetrains Sdn Bhd. The long-drawn court battle had proceeded all the way up to the Federal Court.
JF Apex is a unit of Main Market-listed Apex Equity Holdings Bhd, which was founded by the late Chan Guan Seng.
Meanwhile, Insas Bhd in October last year unveiled its plans to unlock the value of M&A Securities Sdn Bhd via a reverse takeover exercise.
M&A Securities, whose managing director of corporate finance is prominent dealmaker Datuk Bill Tan, is valued at RM222 million. The securities firm is set to assume the listing status of furniture maker SYF Resources Bhd, which will be renamed as M&A Capital Bhd.
Insas is the flagship company of media-shy businessman Datuk Seri Thong Kok Khee.