KUALA LUMPUR: Integrated palm oil milling services provider Ecoscience International Bhd aims to raise RM24.7 million from its initial public offering (IPO).

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

Managing director Wong Choi Ong said from the RM24.7 million, the company would allocate RM5.0 million for the incorporation of a wholly-owned subsidiary in Indonesia.

Wong said RM5.0 million would be used to establish a new fabrication facility and office in Balikpapan in East Kalimantan, Indonesia. 

"With the increase in upstream activities and Indonesia being the world's largest palm oil producer, the move will put us in a stronger position to capitalise on the uptrend," he said in a statement.

According to Wong, the expansion was expected to shorten the response time to requests from the company's Indonesian customers and reduce shipping costs. 

Furthermore, he said having a fabrication facility in Indonesia also enhanced Ecoscience's company's prospects in securing new contracts for the expansion or development of palm oil plants and facilities or other related sectors there.

"At the same time, RM1.0 million will be set aside to expand our environmental and energy efficiency business with the purchasing and leasing of non-chemical water treatment equipment for use in palm oil and other industries. 

"This will give the group a recurring revenue stream while providing a platform for us to diversify our customer base to other sectors," he said.

Ecoscience's IPO of 112.2 million shares representing 33.0 per cent of the enlarged share capital, comprises a public issue of 82.2 million new shares and an offer for sale of 30 million existing shares. 

The company said 17.0 million shares would be made available for the public, 6.8 million for eligible directors, employees and persons who have contributed to the success of the company, 42.5 million by way of private placement to identified Bumiputera investors approved by the Ministry of International Trade and Industry (MITI) and the remaining 45.9 million to selected investors.

At an issue price of 30 sen per share and an enlarged share capital of 340.0 million shares upon listing, Ecoscience will have a market capitalisation of RM102.0 million.

Applications for the public issue are open today and will close on July 1.

Ecoscience is scheduled to be listed on on July 18.