Malaysia: The Body Shop retailer InNature to tap IPO route to raise funds

The Body Shop logo sits on the lids of body butter moisturiser inside a Body Shop International Plc store, owned by L'Oreal SA, in London, U.K., on Thursday, April 6, 2016. Photographer: Chris Ratcliffe/Bloomberg via Getty Images

Malaysia-based InNature Bhd, the retailer, and distributor of The Body Shop products, is planning a public offering on the Main Market of Bursa Malaysia by issuing up to 177 million shares.

According to InNature’s prospectus exposure published on the Securities Commission (SC) Malaysia website, the issue price, and the opening and closing dates of the IPO have yet to be fixed.

A report by The Star said the IPO may raise as much as 200 million ringgit ($48.6 million). In the prospectus exposure, InNature said it plans to use the proceeds of the IPO for capital expenditure, working capital as well as new business development.

Founded in 1984, InNature sells and distributes The Body Shop products in Malaysia and Vietnam. It plans to enter the Cambodian market by the second half of 2019. In Malaysia, it has 89 points of sale and 26 in Vietnam, including online platforms.

The 177.27 million shares offered represents about 25.1 per cent of the enlarged issued share capital. It will comprise 74.07 million new shares and an offer for sale of 103.20 million existing shares.

The 103.20 million offer shares will be allocated to Malaysian and foreign institutional and selected investors, including Bumiputera investors approved by Malaysia’s Ministry of International Trade and Industry.

Of the 74.07 million new shares, 57.94 million will be allocated to Malaysian and foreign institutional and selected investors, 14.13 million will be allotted to the Malaysian public while 2 million shares have been reserved for the directors and eligible employees of InNature and its subsidiaries.

The Main Market of Bursa Malaysia is finally getting some action after a listing hiatus since the country’s general election last May.

It saw the first IPO on the main market this May when local integrated poultry producer Leong Hup International Bhd made its debut at 1.12 ringgit. Backed by Hong Kong-based private equity firm Affinity Equity Partners, Leong Hup raised some $288 million from the IPO.

Although Leong Hup’s IPO offering size was slashed by almost half as investor demand softened in a volatile market, it was still the biggest IPO that the Malaysian bourse has seen since Lotte Chemical Titan Holding Bhd’s listing in July 2017.

But local fast-food operator QSR Brands (M) Holdings Bhd was not as lucky. Due to the ongoing market volatility, it decided to postpone its IPO following discussions with its bankers. It was seeking to raise about 2 billion ringgit ($500 million), providing an exit to global private equity firm CVC Capital Partners and the Employees Provident Fund (EPF), who hold 24 per cent stake each in QSR.

Another notable IPO that is worth looking forward to will be by local home improvement retailer Mr.D.I.Y., which is backed by local private equity firm Creador. We reported that the company is looking to list as early as this November and could raise as much as 1.5 billion ringgit ($360 million).

Loob Holding, the owner of the Tealive bubble tea brand, is also reportedly planning a Malaysia IPO and may raise as much as 300 million ringgit ($72 million), with a target to go public in 2020.