Malaysian energy and water company Ranhill Energy and Resources Bhd is expected to launch its initial public offering (IPO) on June 28 that will target raising RM1.0 billion (US$319.23 million), two sources said.

Ranhill Energy joins a queue of IPO aspirants who are taking advantage of ebbing political risk in the South-East Asian country after May general elections concluded with a win for the long-ruling National Front.

Long-haul carrier AirAsia X Bhd is looking to raise US$370 million in a listing, with pricing to take place on June 24. Malaysia’s state investor Khazanah Nasional Bhd plans to list its theme park business next year in an IPO that could raise up to US$150 million.

“They are finalising the cornerstone investors now,” said one of the sources, who declined to be named because the matter was private.

A second source said pricing and listing are expected in July. Both sources had direct knowledge of the matter.

Ranhill Energy officials were not immediately available to comment.

The company, which counts its president and chief executive, Hamdan Mohamad, and regional investment fund Cheval Infrastructure Fund LP among its shareholders, provides engineering services for the onshore and offshore oil and gas, refinery and petrochemical industries.

It also owns and operates two 190-megawatt combined-cycle gas-fired power plants in the west Malaysian state of Sabah, and was awarded an exclusive licence by the government to provide

‘source-to-tap’ water supply services in Johor, the second most populous state in the country.

China expansion planned

Ranhill Energy will use about 70 percent of the IPO proceeds to redeem Islamic notes and bonds, 19.1 percent to pay off company acquisitions, 7.1 percent to expand its water business in China, and the rest for listing expenses, according to a draft prospectus filed on Jan 13.

Maybank Investment Bank is the principal adviser for the IPO. CIMB Investment Bank and Maybank Investment Bank are the joint global coordinators and bookrunners. They are also the underwriters for the deal.

Malaysia was the top IPO market for Asia ex-Japan in 2012, boosted by government privatisations and a strong economy, but the IPO pipeline slowed ahead of the polls because of concerns over market volatility.

“We are looking at quite a number of listings (this year), probably as many as last year or more, but not the size,” Maybank Investment Bank Bhd’s CEO Zafrul Aziz said.

- Reuters