KUALA LUMPUR: Infoline Tec Group Bhd aims to raise RM23.68 million from its initial public offering (IPO) to strengthen its market position to capture the growing demand for information technology (IT) solutions as the world shifts to the digital era.

The company launched its prospectus in conjunction with its IPO on the ACE Market of Bursa Malaysia earlier today.

Group chief executive officer Choo Wei Chuen said rapid technological shifts had accelerated the adoption of artificial intelligence (AI), big data, cloud computing, Internet of Things (IoT) and social and media computing.

"In line with these trends, demand for IT infrastructure and cybersecurity solutions would increase as enterprises need to ensure that the large volumes of data generated are transmitted and stored securely.

"Furthermore, we also foresee strong demand for managed IT services, which is a cost-effective solution for many enterprises without having to incur substantial operational expenses to set up their own dedicated IT team," he said.

The company noted that proceeds from the IPO will be utilised to upgrade its hardware and software IT infrastructures.

A total of RM17.46 million, representing more than 70 per cent of the IPO proceeds, will be allocated to enhance the company's existing network operation centre and set up security, technology, and disaster recovery centre.

Infoline Tec will channel RM2.22 million towards business expansion activities to grow the company's presence in Malaysia and international markets, while the remaining IPO proceeds will be utilised for listing expenses.

Malaysian Industrial Development Finance Bhd group managing director and executive director of MIDF Amanah Investment Bank Bhd Datuk Charon Wardini Mokhzani said Infoline Tec has grown since it was founded in 2013, and the management team has built the company to be an IT infrastructure and cybersecurity solutions provider with a strong portfolio of multinational and local customers.

"The upcoming IPO of the company represents the next stage of growth. On top of enabling the company to raise capital for expansion, the listing will also enhance the group's standing amongst existing and potential customers, provide greater transparency, and attract talent," he said.

The company has set a target to distribute at least 30 per cent of its net earnings as dividends to shareholders.

The company's IPO comprises a public issuance of 74.00 million new shares, representing 20.38 per cent of the enlarged shares, and an offer for sale of 22.25 million existing shares, representing 6.12 per cent of the enlarged shares, by way of a private placement to selected investors.

Infoline Tec and its subsidiaries provide IT infrastructure solutions, cybersecurity solutions, managed IT and other IT services and trading ancillary hardware and software.