Big Caring launches IPO valuing Malaysian pharmacy chain at $2 billion

By Yantoultra Ngui

HONG KONG, Oct 29 (Reuters) - Malaysian pharmacy chain Big Caring Group on Thursday launches its initial public offering, which could value the company at about 8 billion ringgit ($2 billion) ahead of a planned November 19 listing debut on Bursa Malaysia.

The retailer is offering up to 1.9 billion shares at a maximum price of 1.08 ringgit each, Big Caring said in a statement.

The sale includes 590.5 million new shares, expected to raise about 637.8 million ringgit for the company, and 1.3 billion existing shares sold by current shareholders, it added.

The 8 billion ringgit valuation is based on Big Caring's enlarged share base of 7.4 billion shares and the maximum IPO price, it said.

"The launch of our prospectus marks an important milestone in Big Caring Group's growth journey," said Group Managing Director and Chief Executive Lee Meng Chuan.

Big Caring, which has more than 600 outlets in Malaysia, said it plans to use 89.5% of the proceeds from the new shares to repay bank borrowings within three months of listing.

It will use 4.7% to build a distribution centre within 36 months and the rest for listing costs, it added.

It also targets dividend payments of up to 50% of profit attributable to owners, subject to factors including cash levels, debt and capital spending needs.

Big Caring said 19 cornerstone investors, or investors that agree to buy shares before a listing, will buy a combined 665.5 million shares.

The investors include International Finance Corp, JPMorgan Asset Management, abrdn, Principal Asset Management and First Sentier Investors.

Maybank Investment Bank, RHB Investment Bank and AmInvestment Bank are joint principal advisers and global coordinators. UBS Securities Malaysia and UBS AG's Singapore branch are also joint global coordinators and bookrunners, the statement showed.

($1 = 4.0740 ringgit)