NRF prices its IPO at 4-4.6 baht, aims to be first Thai company in the future of food market
NRF prices its IPO at 4-4.6 baht, aims to be first Thai company in the future of food market, open to retail investors from 28-30 September
NR Instant Produce PCL (NRF), a leading food and seasoning manufacturer and exporter, prices its IPO at 4.00-4.60 baht per share, available for retail investors to subscribe during 28-30 September. The company is also surveying the demand of institutional investors, with subscription on 1-2 and 5 October, to determine the final offering price. The executives plan to be the first Thai company to pursue plant-based food and become a global leader in the food industry.
The company has appointed Siam Commercial Bank PCL as its financial advisor, SCB Securities Co., Ltd. as its lead underwriter, and four other securities companies as its underwriters, namely, Krungthai Zmico Securities Co., Ltd., Finansia Syrus Securities PCL, Maybank Kim Eng Securities (Thailand) PCL, and KTB Securities (Thailand) Co., Ltd.
Ms. Veena Lertnimitr, Executive Vice President and Head of Investment Banking, Siam Commercial Bank PCL, as financial advisor and lead underwriter, disclosed that NR Instant Produce PCL, or NRF, is preparing to offer up to 340 million ordinary shares to the public (IPO) by setting a price range of IPO shares at 4.00-4.60 baht per share open to retail investors to subscribe on 28-30 September 2020, at a price of 4.60 baht per share, the highest point in the initial offering price range. The company is also conducting a survey of institutional investors’ subscription demand (Book Building) to determine the final offering price (Final Price), expected to be announced on 30 September. However, if the final offering price is lower than the subscription price, the company will proceed to refund the excess subscriptions paid to the retail investors. Institutional investors will subscribe to the IPO shares on 1-2 and 5 October 2020, at the final offer price. It is expected that NRF shares will be traded on the Stock Exchange of Thailand (SET) by mid-October.
NRF has registered authorised capital of 1,421,040,400 baht with paid-up capital of 1,065,780,300 million baht and par value at 1 baht per share equal to 1,065,780,300 shares. The IPO accounts for no more than 340 million shares or 25.08 percent of all issued ordinary shares and all available shares of the company. These are divided into not more than 290 million new ordinary shares and offering ordinary shares by existing shareholders, DPA Fund S Limited, amounting to not more than 50 million shares.
Mr. Dan Pathomvanich, Chief Executive Officer, NRF, said the company is well recognised as a manufacturer, procurer and distributor of condiments, processed food and processed food ingredients, vegan food without egg and milk ingredients, food from plant protein and instant drinks in both liquid and powder forms, as well as non-food consumer products in V-shape packaging (friendly to consumers and the environment). He said the company is the first manufacturer in Thailand to prepare for production, new technologies, and innovations to support becoming a leader in the international food manufacturing industry. It is also ready to support high-growth food products in the future (Platform for Future Food) with over 30 years’ experience accumulated by its product research and development team in relation to a wide variety of products from both domestic and international factories under internationally recognised standards for sale in distribution channels of over 25 countries including the USA, UK, Germany, South Africa, and Japan.
Currently, the company is recognised as the industry leader in the manufacturing and exporting of processed foods, quality condiments, and foods made from plant-based protein, with products covering more than 2,000 SKUs and more than 500 food recipes in three business groups:
1) Ethnic food categorised into OEM/Private Labels and NRF brands. OEM/Private Labels comprise food ingredients and condiments, ready-to-cook food, ready-to-eat food, and dry and liquid instant drinks and microwaveable food such as rice and noddle dishes or different types of sauces packed in readily microwaveable packaging. Products under the company’s own brands total six brands comprising curry and tom yam ingredients under “Por Kwan” brand; food ingredients with Asian flavours under “Lee Brand”; ready-to-eat food in microwaveable packaging such rice dishes and Pad Thai under “Thai Delight” brand; food ingredients and instant soup under “Shanggie” brand; instant drinks in dry and liquid forms under the “DeDe” brand; and food ingredients and chilies in snack form under the “Sabzu” brand.
2) Plant-based food group comprising food items made from plant protein that are good for health and vegan and vegetarian food dishes that have their flavours and appearances enhanced to resemble animal meat products. The premium-grade raw materials used are carefully selected with the ultimate consideration for the health and well-being of consumers. These include synthetic meat made from jackfruit and eggplant, shirataki or konjac noodle.
3) Functional product business comprising non-food consumer products contained in packaging friendly to consumers and the environment (V-shape). These include alcohol gel products in environmentally-friendly packaging that are easy and convenient to use and of the highest quality. The company is also in the process of expanding into other products such as food, food supplements, cosmetics, and personal hygiene products.
The company plans to use part of the capital raised by the offering to repay long-term loans, allowing it to reduce its debt burden and increase its liquidity. It will also utilise the fresh capital to expand the business in accordance with the following planned projects:
1) Buy another 85 percent of the shares of City Food Co., Ltd. within 2020 as the company has invested in 15 percent of fully paid-up ordinary shares to further expand production capacity to support growth of the ethnic food category. City Food is a manufacturer and exporter of seasonings under the “Classic Thai” brand and “Shinpo” soy milk. It is also a contract manufacturer of various food products for world-class food brands.
2) Acquire plant-based protein food factories in the UK and USA in a joint venture with The Brecks Company Limited under a newly set-up company in the UK, Plant and Bean Limited. The new company accepts orders to process food products from plant protein for many world-leading food companies and plans to increase production capacity from the current 3,400 tons to 36,000 tons by 2021 in order to meet the growth in demand.
3) Invest in the construction of NRF Global E-Commerce Platform in cooperation with Boosted Ecommerce Inc. (Boosted) to jointly invest in and develop branded e-commerce business, including supply chain improvement and business scale expansion, to expand online business and increase distribution channels to reach consumers around the world. NRF will invest with Boosted in two forms: establishing a joint venture to invest in food-related businesses in which NRF will be a major shareholder, and investing in Boosted Ecommerce Inc., which invests in other types of ecommerce businesses. The rest of capital will be used as working capital.
Performance in the first half of 2020 saw revenue of 603.7 million baht and net profit of 41.1 million baht, up by 517.4 million baht and 16.3 million baht respectively from the same period of 2019. The increase resulted from expansion of the company’s manufacturing base to support expansion of production to meet increased import demand from the USA, Europe, Oceania, and Asia, as well as effective management of production and operational costs, and new revenue from the new business group comprising non-food consumer products contained in packaging that are friendly to consumers and the environment (V-shape).