Southern Alliance Mining to raise funds in Catalist listing

MALAYSIA-BASED iron ore producer Southern Alliance Mining (SAM), lodged its final prospectus on Tuesday, offering 76 million placement shares at S$0.25 each for placement in its initial public offering (IPO). The shares, which will be listed on the Catalist board, comprise 56 million new shares and 20 million vendor shares, representing approximately 15.5 per cent of SAM's enlarged post-IPO share capital of 489 million shares.

The IPO is priced at approximately 6.13 times price-to-earnings based on the group’s FY2019 audited profit before tax, which excludes the tax credit in FY2019.

The company plans to use net proceeds of S$11.9 million from the issuance of new shares for further exploration activities, investment into mining equipment and infrastructure, acquisitions, joint ventures, strategic alliances and/or development of new mines and general working capital purposes. It will not receive any proceeds from the sale of the vendor shares.

SAM was co-founded by chief executive officer Pek Kok Sam and non-executive and non-independent chairman Teh Teck Tee who have over 30 years of cumulative experience in the exploration and mining of mineral deposits in Malaysia.