PropNex launches Mainboard IPO at 65 cents per share

It aims to raise $38m and boost market cap to $240.5m.

PropNex has registered the prospectus for its initial public offering (IPO) and the listing of shares on the Singapore Exchange (SGX) Mainboard. It is eyeing to grow its market cap to $240.5m after the offering.

According to an announcement, it aims to raise $38m from the IPO. About 42.5 million shares are being offered at 65 cents each. About 40.375 million shares will be offered through a placement for investors.

The proceeds will go to local and regional expansion through acquisitions, enhancement of its real estate brokerage businesses, and expansion of its services, amongst others.

PropNex was able to engage cornerstone investors for 50 million shares at the offering price. FIL Investment Management (Hong Kong) pledged 12.35 million shares, NTUC Income Insurance Co-Operative pledged 9.05 million shares.

Other cornerstone investors include Affin Hwang Asset Management, Samsung Asset Management (HK), Value Partners Hong Kong Limited, Nikko Asset Management Asia Limited.

PropNex CEO and executive chairman Ismail Gafoor commented, “Our IPO is yet another exciting milestone for us as it provides a platform for PropNex to not only further solidify our position in Singapore, but also access to the capital market to expand our business into new consultancy services as well as promising geographical markets, such as Vietnam and other Southeast Asian countries.”

The offering will open in Singapore upon registration of the prospectus and will close at noon on 28 June 2018. Trading of PropNex’s shares is expected to commence on a “ready” basis at 9 a.m. on 2 July 2018.

UOB Kay Hian Private Limited is the sole issue manager, underwriter, and placement agent.

PropNex is Singapore’s largest real estate company in terms of size with 7,248 salespersons as ay 6 June 2018. The company covers commercial real estate, industrial real estate and residential real estate, including new developments, resale and leasing.

Separately, it responded to media reports saying the transaction between PropNex Realty and Dennis Wee Realty was without monetary terms and that there were inconsistencies between its unaudited profit and revenue to the figures in its preliminary prospectus.

“As at the date of the press conference, the memorandum of understanding entered into between PropNex Realty and DWR had set out the understanding, intention and agreement-in-principle for, among others, DWR to assist in the transfer of DWR Salespersons to PropNex,” Gafoor said. “Neither the company nor Mr. Mohamed Ismail had indicated that the transfer of DWR Salespersons would be free.”

The articles also said that the company had provided unaudited revenue and net profit for FY2016 as $278.9m and $9.23m respectively. “These figures were announced prior to the group’s consolidation of its business entities in the lead-up to the proposed initial public offering,” Gafoor added.

He also said that the preliminary prospectus contains the audited financial statements of the group.