7-Eleven Malaysia prices at top of range

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7-elevenMalaysia’s largest convenience store chain, 7-Eleven Malaysia Holdings Bhd, has raised about 732 million ringgit ($226.91 million) in a share sale priced at the top of expectations, according to two sources with direct knowledge of the deal.

The company, controlled by Malaysian billionaire Vincent Tan, priced the initial public offering at 1.38 ringgit per share which compares with an indicative price range of 1.33 ringgit to 1.38 ringgit.

The company plans to use most of the proceeds to open 600 stores over the next three years, a much faster pace than the 300 opened over the past three years, according to its prospectus. It currently has almost 1,600 outlets.

Maybank and UBS are the joint global co-ordinators and are the joint bookrunners along with CLSA, CIMB and Kenanga.

7-Eleven Malaysia already has a dominant presence in Malaysia, with an 82 per cent share of the convenience retail store market and 1,583 stores spread throughout the Peninsular and East Malaysia. Yet the company maintains that its growth prospects remain promising, underpinned by the fact the convenience store segment in Malaysia is still relatively underpenetrated.

According to a report by Vital Factor Consulting, Malaysia only has 131 million stores per million of the population compared with 192 in Thailand (where CP currently has 7,041 stores) and South Korea with 490 stores.

About half of 7-Eleven Malaysia’s current Malaysian stores are also in the Klang Valley, which surrounds Kuala Lumpur. Over the next two years, the group intends to add a further 600 net new stores, mainly in East Malaysia.

Quite a significant chunk of the IPO proceeds will be used for store refurbishment, which the group hopes will increase sales by 10 to 15 per cent. It also plans to equip its new stores with wireless networks in an effort to attract a younger crowd and aims to boost its profitability with more focused promotions and by increasing in-store services such as bill payments.

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Reading Time: 2 minutes

Malaysia’s largest convenience store chain, 7-Eleven Malaysia Holdings Bhd, has raised about 732 million ringgit ($226.91 million) in a share sale priced at the top of expectations, according to two sources with direct knowledge of the deal.

Reading Time: 2 minutes

7-elevenMalaysia’s largest convenience store chain, 7-Eleven Malaysia Holdings Bhd, has raised about 732 million ringgit ($226.91 million) in a share sale priced at the top of expectations, according to two sources with direct knowledge of the deal.

The company, controlled by Malaysian billionaire Vincent Tan, priced the initial public offering at 1.38 ringgit per share which compares with an indicative price range of 1.33 ringgit to 1.38 ringgit.

The company plans to use most of the proceeds to open 600 stores over the next three years, a much faster pace than the 300 opened over the past three years, according to its prospectus. It currently has almost 1,600 outlets.

Maybank and UBS are the joint global co-ordinators and are the joint bookrunners along with CLSA, CIMB and Kenanga.

7-Eleven Malaysia already has a dominant presence in Malaysia, with an 82 per cent share of the convenience retail store market and 1,583 stores spread throughout the Peninsular and East Malaysia. Yet the company maintains that its growth prospects remain promising, underpinned by the fact the convenience store segment in Malaysia is still relatively underpenetrated.

According to a report by Vital Factor Consulting, Malaysia only has 131 million stores per million of the population compared with 192 in Thailand (where CP currently has 7,041 stores) and South Korea with 490 stores.

About half of 7-Eleven Malaysia’s current Malaysian stores are also in the Klang Valley, which surrounds Kuala Lumpur. Over the next two years, the group intends to add a further 600 net new stores, mainly in East Malaysia.

Quite a significant chunk of the IPO proceeds will be used for store refurbishment, which the group hopes will increase sales by 10 to 15 per cent. It also plans to equip its new stores with wireless networks in an effort to attract a younger crowd and aims to boost its profitability with more focused promotions and by increasing in-store services such as bill payments.

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