News / MTT Shipping IPO raises $165m to expand box ship network

Credit MTT Shipping and Logistics

Malaysian feeder operator MTT Shipping & Logistics has raised $165m in an IPO that saw the company listed on the Bursa Malaysia today.

Close to 96% of the proceeds will be used to fund the building or purchase of a dozen containerships and expand its network over the next three years.

The IPO, Malaysia’s largest since 2013, was oversubscribed by nearly three times, reflecting investor interest in the container segment.

Despite the successful IPO, MTT’s stock was muted after an excited start to its first trading day. When trading ended at 5pm Malaysia time, the stock price closed at MYR1 ($0.25) after initially opening at MYR1.08 ($0.27), above its IPO price of MYR1.03 ($0.26).

For the IPO, MTT issued 633.5m new ordinary shares, consisting of an institutional offering of 571m shares for Malaysian and foreign institutional investors, including approved Bumiputera (aboriginal Malaysians) investors, and a retail tranche of 62.5m shares for directors, employees, contributors, and the Malaysian public via balloting.

During the prospectus launch last month, MTT’s executive chairman, Kenny Ong Kean Lee, said: “Having established ourselves as the nation’s leading domestic container liner shipping operator, we have always made it our focus to strive for consistent improvement across our operational footprint. We believe the timing for this expansion is appropriate as regional trade continues to evolve, and demand for reliable shipping capacity across key domestic and regional routes remains strong.”

MTT’s feeder services cover routes between ports in Peninsular Malaysia and East Malaysia as well as overseas ports around the Southeast Asia region such as Singapore, Thailand, Brunei, Indonesia, India and Myanmar.

To a lesser extent, MTT functions as a tonnage provider, chartering some of its feeder vessels to other operators like Evergreen Marine Corporation.

As of September, MTT owns the largest fleet of Malaysian-flagged containerships with an average age of 6.7 years, the youngest fleet among Malaysian operators.

The company currently owns 14 ships, with another four vessels under construction at Penglai Zhongbai Jinglu Ship Industry.

Inside the industry’s AI shift

Complete The Loadstar’s ‘State of AI in the Supply Chain’ survey — and receive the full report and data before release.

Take the 2-min survey