EDBI-Backed Docking Systems Company Mooreast Raises $ 8.5 Million on Catalist List
SINGAPORE (BUSINESS HOURS) – Mooreast Holdings launched its initial public offering (IPO) on Wednesday (November 17th) for a listing on the Catalist board of directors of the Singapore Exchange (SGX).
The docking systems company will offer 0.8 million offering shares and 38.05 million offering shares at 22 cents each. This will bring the total gross proceeds from the IPO to some $ 8.5 million.
EDBI, the investment arm of the Singapore Economic Development Council, has invested $ 10 million in the company as a pre-IPO investor.
Mooreast is a total mooring solutions specialist serving primarily the offshore oil and gas, marine and offshore renewable energy industries.
In an interview with The Business Times, Mooreast chief executive Sim Koon Lam said the group’s solutions included the design, engineering and manufacture of mooring systems, as well as components such as cables in steel, anchor chains, high holding power anchors and weights. . These help to keep offshore oil rigs firmly anchored to the seabed and stable.
Renewable energy is expected to be a major engine of growth for the company, which will have a notional market capitalization of $ 57 million.
Mr Sim said the group embarked on renewable energy in 2013, after the 2011 earthquake and tsunami in Japan “opened up new opportunities” for the company to launch this pivot.
He expects the group’s switch to renewable energies to bear fruit as part of the global energy transition. Mooreast is also in the midst of a “technology migration” – leveraging its understanding of the oil and gas market and applying the relevant technology to different types of offshore floating renewable energy sources.
One of Mooreast’s main focus areas is floating wind platforms, but the group is also able to provide solutions for solar and tidal platforms.
About half of the proceeds from Mooreast’s IPO, or $ 4 million, will be used to expand the group’s improved waterfront facilities at 51 Shipyard Road in Jurong, and ramp up operations in anticipation of the outlook. floating wind power. Mooreast will also invest in additional equipment and machinery.
Another $ 1 million, or 11.7% of the IPO’s proceeds, will be spent on merger and acquisition activity, primarily in the renewable energy arena, Sim said. The group will focus on acquiring IT or technology companies that can help it improve its operations in the renewable energy sector, he added.
Mooreast will use an additional $ 0.5 million of the IPO proceeds to develop and grow its renewable energy division. Among other things, the company wants to strengthen its engineering capabilities by recruiting more engineers and professionals with the relevant experience and expertise, and set up a research and development team to research new products and technologies. .
Another $ 1.2 million of the proceeds will be used for general corporate and working capital purposes, with the remaining $ 1.8 million earmarked for invitation and registration costs.
For the first six months of 2021, Mooreast reported unaudited after-tax profit of $ 0.4 million, down significantly from $ 2.3 million a year earlier. Revenue fell 22.9% to $ 7.2 million from $ 9.3 million.
Looking ahead, Mooreast expects the recovery of the oil and gas sector and growing demand for renewable energy to support its growth in the years to come.
Mr Sim said the company is involved in several talks in the field of renewable energy and hopes that these talks will turn into real contracts. In the oil and gas industry, the company is only involved in a few contracts.
Mr. Sim started in the industry by joining the Singapore branch of Dutch offshore entrepreneur Vrijhof Ankers Beheer in 1992, but moved to manufacturing in 2007 by acquiring Mooreast.
Having been in the industry for the past three decades, he said that one of the most important requirements for a business to survive in the competitive industry is to remain flexible and adapt to change.
“(I) went through several ups and downs, and each up and down is a different problem,” he said. “So you learn new things and then you meet and see how to solve it.”
IPO requests close next Monday at noon, while trading in the company’s shares is expected to begin when the market opens next Wednesday.