Sheffield Green to raise S$6 million through Catalist IPO at S$0.25 a share
Janice Lim
HUMAN resources provider Sheffield Green is seeking to raise over S$6 million through an initial public offering (IPO) on the Catalist board of the Singapore Exchange.
The Singapore-based company, which mainly fulfils the staffing needs of the renewable energy industry, is offering 24 million new shares at S$0.25 apiece – 3.6 million shares will be offered to the public, with the remaining 20.4 million as placement shares.
The counter is expected to begin trading on Oct 30, said its final offer document registered on Monday (Oct 16).
After taking into account expenses relating to the listing, the company expects net proceeds of S$3.8 million from the sale of the shares.
Based on the issue price of S$0.25 a share and assuming all shares on offer are successfully subscribed, Sheffield Green will have a market capitalisation of S$46.6 million at listing.
The company directors also intend to distribute 30 per cent of the net profit after tax as dividends to shareholders.
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Incorporated in Oct 2021, Sheffield Green is the renewable energy spinoff of Sheffield Energy – a recruitment company for the oil and gas sector.
In an interview with The Business Times, Sheffield Green’s chief executive officer Bryan Kee said the holding company saw an opportunity to diversify its business back in 2015, when the oil and gas sector was going through a downturn, and many professionals from the sector were being retrenched.
Before Sheffield Green was formally incorporated, the company ventured into the sector with one or two projects in the European Union, where the offshore wind space was taking off in 2015; in 2018, it made a foray into Taiwan, where the government was offering support for renewables.
Despite the existence of older renewable energy solutions from solar and onshore wind energy, Kee said the company focused on offshore wind because solar and onshore wind technologies were already mature back in 2015, and therefore could not have offered as much by way of margins.
The final offer document said that 52.5 per cent of the proceeds would be used to expand the scale of the company’s existing business and geographical coverage, as well as for complementary offerings, new product lines and other technical services.
Kee said the immediate priority would be to put the funds into setting up a training school in Taiwan to build up the territory’s offshore wind expertise, and also to open more offices beyond Asia.
The company plans to open an office in Poland by November, to manage offshore wind projects in the Baltic region; it will also open one in Boston in the United States by the first quarter of next year, given that work has begun on its first offshore wind project in New York.
Currently, most of its business is from offshore wind projects in Taiwan. Kee estimates that Sheffield Green is involved in about 80 per cent of all offshore wind farms across the supply chain there. It entered the Japanese market in 2021, and is now looking at the South Korea market. He added, however, that the progress of offshore wind development was slowed by the Covid-19 pandemic in Japan, and by declining government support in South Korea.
Kee also said that the company is looking at potentially acquiring some entities in mature markets such as the United Kingdom to grow its staffing business.
The rest of the funds raised will go into expenses and working capital.
These markets aside, Sheffield Green will start exploring the Australian market next year. Kee believes that offshore wind will take off in Australia between 2025 and 2026, given that many offshore wind developers are contemplating projects in that market.
Government support for renewables presents both a major risk factor and an opportunity for the industry. However, the push by many governments for net-zero emissions, along with fossil fuel prices rising on the back of the Russia-Ukraine war, will make the industry recession-proof, said Kee.
He acknowledged that one major challenge for Sheffield Green lies in the lack of talent in the offshore wind sector, the technology for which is still relatively new in Asia.
This is one reason the company is setting up a training school, instead of just helping offshore wind developers recruit skilled professionals. A school will enlarge the supply of skilled workers, and eventually stabilise the industry’s rapidly rising manpower costs, said Kee.
Besides offshore wind, Sheffield Green is also looking to get involved in the staffing needs of green hydrogen projects. Green hydrogen developers, potential awardees for Oman’s green hydrogen land auction, are already planning to ramp up recruitment in the second half of next year, he said.
Beyond these near-term plans, Sheffield Green is looking into how it can also be an operations-and-maintenance provider for offshore wind farms five to 10 years down the road. As many offshore wind projects are currently being constructed, developers will eventually need to engage service providers to run and maintain these farms.
“Our intention is to be a solutions provider in the long term, not just a staffing company,” Kee said.
While its parent company may be related to fossil fuels, Kee said that Sheffield Green is a “purely green” company.
“You look at what is in the market now – many publicly listed companies still have the traditional oil and gas business sitting in them, which we want to differentiate ourselves from. We want investors to value us as a purely green company.”
Application for Sheffield Green’s shares closes at noon on Oct 26. Evolve Capital is the company’s sponsor.
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