Xyec Holdings IPO raises S$6.5m in gross proceeds

Catalist trading debut set for tomorrow.

Xyec Holdings Co., Ltd. (Xyec), noted as the first Japanese company with a primary listing on the Singapore Exchange, has announced that as at the close of the Application List at 12.00 noon today, the 25 million new shares at S$0.26 each have been validly and fully subscribed for.

The trading of its shares on the Catalist Board of the Singapore Exchange Securities Trading Limited is expected to commence at 9:00 am on 18 September 2013.

The 25 million Placement Shares were fully placed out to investors, raising gross proceeds of S$6.5 million.

Xyec’s controlling shareholder Mamezou Holdings Co., Ltd., a publicly listed company on the Tokyo Stock Exchange, has applied for and was allotted more than 5.0% of the Placement Shares.

PrimePartners Corporate Finance Pte. Ltd. is the Manager, Sponsor and Placement Agent in relation to the IPO.

Commenting on the IPO, Mr Manabu Kobayashi, Executive Chairman, President and Chief Executive Officer of Xyec, said, “We are heartened by the positive response from investors for our Placement Shares, which we believe is a strong testament to our business fundamentals and investment merits. We are also glad to be the first Japanese company with a primary listing on the Singapore Exchange. Singapore’s well-developed financial market, and its reputation as an Asian hub for global manufacturers, will benefit our future business development.”

As part of its strategy to expand in Asia, the Group intends to establish an office in Singapore to support its research and development initiatives and as a regional sales office for Southeast Asia. It also plans to establish its own data centre to aid the delivery of its cloud computing and information security services to its customers.

Through its subsidiary, Kowamex (Thailand) Co., Ltd, the Group also plans to expand its customer base of Japanese automobile makers and other manufacturing companies operating in Thailand, and to expand into other Southeast Asian countries. In addition, the Group plans to develop its proprietary software for Automobile Electronic Control Units for the local automobile makers in the PRC and in ASEAN countries.

On the IT Services front, the Group’s strategy includes diversifying its client portfolio to include SMEs and expanding the range of its offerings using new technologies, such as open source infrastructure services, cloud computing and thin client computing.

For its IT Solutions business segment, which enjoys relatively higher margins, the Group plans to upgrade its proprietary software, expand its Two-Tier ERP services to new markets, as well as develop new business-related and customer relationship management software.

At the same time, the Group is exploring potential investments and acquisitions in complementary businesses, such as those with expertise in IT network services, web software development, information security, database, cloud computing and software engineering service providers.

The Directors intend to recommend and distribute dividends of at least 20.0% of the Group’s net profit after tax attributable to shareholders in each of FY2014, FY2015 and FY2016.