KUALA LUMPUR (Reuters) - QSR Brands, Malaysia’s largest fast-food operator, is considering an initial public offering to raise around 2 billion ringgit ($509.6 million), shareholder Johor Corp said on Wednesday.
Johor Corp [JOHOR.UL] would like to see QSR’s IPO done no later than November, its president and chief executive officer, Kamaruzzaman Abu Kassim, told reporters. Johor Corp is the investment arm of Malaysia’s Johor state.
The listing would be the largest IPO in Malaysia since integrated petrochemical producer Lotte Chemical Titan Holding Bhd raised $878 million in July last year.
That IPO spooked the market as Lotte Chemical had to cut the size of its offering and price its shares lower than had been anticipated due to weak demand.
Malaysia’s Securities Commission expects IPOs this year to raise about 8 billion ringgit, up from 7.2 billion ringgit in 2017. Other IPOs in the pipeline include Edra Power Holdings looking to raise $500 million to $1 billion.
“As soon as we are able to sort out various issues at the company, we will put it back onto the listing track,” Kamaruzzaman said, adding that QSR was already at an advanced stage of its restructuring.
QSR’s IPO has been planned since 2016, sources told Reuters previously, and the company had hired three banks including Citigroup and Credit Suisse to lead the exercise.
In October, Malaysian media reported that Thai Beverage PCL owner Charoen Sirivadhanabhakdi was looking to take a substantial stake in the Kentucky Fried Chicken and Pizza Hut restaurant franchises in Malaysia, which QSR owns and operates.
Johor Corp said the talks were preliminary, and it did not proceed with further discussion. With a plan to list, Kamaruzzaman said all other options had been “put on the back burner”.
The estimated market capitalization of QSR would be about 6 billion ringgit after listing, he said.
“We haven’t decided on the quantum and so on, but further details will have to be worked out with various parties,” he said.
Other owners in QSR, private equity firm CVC Capital Partners Ltd [CVC.UL] and the Employees Provident Fund (EPF), would look to exit the business and the size of their selldown would depend on the details of the IPO, Kamaruzzaman said.
The IPO was part of an “exit plan” for the two partners when QSR was privatised in 2013, he added.
($1 = 3.9250 ringgit)
Reporting by Liz Lee; Editing by Subhranshu Sahu and Stephen Coates