Smartflex's IPO receives 685 valid applications

The company will use $1.50mln from IPO to upgrade process capabilities by acquiring machinery to meet demand.

Marking a significant milestone, Smartflex Holdings Ltd. (Smartflex), a provider of integrated circuit (IC) module assembly and testing services for contact and dual interface smart cards, has garnered overwhelming interest from institutional and retail investors for its initial public offering (IPO or Invitation). The Invitation of 13 million new shares in Smartflex comprised 1.5 million new shares (Offer Shares) for public subscription and 11.5 million new shares (Placement Shares) allocated for placement.

At the close of the Invitation at 12.00 noon on 15 July 2010, there were 685 valid applications received for the 1.5 million Offer Shares available to the public for subscription. In total, these applicants applied for an aggregate of 42.82 million Offer Shares, with application monies received amounting to approximately $9.4 million.

Based on the total Invitation size of 13 million new shares and the total valid applications of the 54.32 million new shares (comprising 42.82 million Offer Shares and 11.5 million Placement Shares), the Invitation was approximately 4.2 times subscribed.

Said Mr Tan Tong Guan, Executive Chairman of Smartflex: “We are extremely encouraged by the positive response to our IPO. This clearly reflects investors’ confidence and trust in our business model and growth prospects. We thank and welcome all new Smartflex shareholders, and we will strive to deliver on our growth plans and stay at the forefront of the industry.”

Out of the $1.76 million in net proceeds raised from the IPO, the Company plans to use approximately $1.50 million to upgrade process capabilities by acquiring machinery to meet rising demand. The remaining proceeds will be used for general working capital requirements.

Smartflex is engaged in the business of assembly and testing of smart card IC modules, catering to a wide range of industries, such as telecommunications, banking and financial services, Pay TV and transportation. The IC modules are mainly used in SIM cards for GSM phones, RUIM cards for CDMA phones, banking cards for secured payment and identification purposes, Pay TV cards, as well as other applications. With the growing trend towards mobile communications, micro-payment (e-purse), and contactless transactions, the high-security smart card industry is facing a situation whereby supply is playing catch-up with demand.

Trading of Smartflex’s shares on Catalist, the Sponsor-supervised board of the Singapore Exchange Securities Trading Limited (SGX-ST), is expected to commence on a “ready” basis at 9.00 am on 19 July 2010.

CIMB Bank Berhad, Singapore Branch is the Company’s Sponsor while CIMB Securities (Singapore) Pte. Ltd. is the Underwriter and Placement Agent of the Invitation.