LHN Limited offers 73.9 million shares at 23 Singapore cents each for Catalist listing

LHN Limited, a property management services group, is placing 73.9 million shares at 23 Singapore cents each for Catalist listing in its initial public offer.

The shares represent 20.4 per cent of the company's enlarged share capital of about 361.5 million shares.

At 23 cents each, the shares are priced at an earnings multiple of 6.5 times based on the group's historical net earnings per share of 3.53 cents for the financial year ended Sept 30, 2014.

LNH plans to use the net proceeds of about S$14.4 million to expand its three core operations of space optimisation business, facilities management business and logistics services, amongst others.

Space optimisation involves the securing of master leases of properties, and transforming them into more efficient usable spaces before leasing to tenants.

"This generally allows the group to enhance the value of properties by increasing their net lettable area (NLA) and potential rental yield per square feet (sq ft),'' it explained.

The group manages a portfolio of 36 industrial, commercial and residential properties in Singapore, one commercial property in Indonesia and one residential property in Myanmar, and these properties have a total NLA of over 4.0 million sq ft.

Under its facilities management business, LNH offers security services, car park management services and property maintenance services to the properties it leases and manages, and to external parties.

It also provides transportation and container depot management services under its logistics services business. It boasts of a fleet of over 35 prime movers, over 10 road tankers and over 110 trailers that transport mainly ISO tanks, containers, base oil and bitumen for clients like Singapore Petroleum Company, Total Oil Asia-Pacific and Idemitsu Lube (Singapore.

LHN's revenue grew at a compound annuall growth rate (CAGR) of 9.9 per cent from about S$75.1 million in FY2012 to about S$90.7 million in FY2014, while net profit grew at a CAGR of 34.7 per cent from S$7.0 million to about S$12.7 million during the same period.

The placement will close at 12.00 noon on April 9, 2015 and trading is expected to start on a "ready" basis at 9.00 am on 13 April 2015.

PrimePartners Corporate Finance is the sponsor, issue manager and placement agent for the IPO and UOB Kay Hian is the sub-placement agent.