LS 2 Holdings’ initial public offering (IPO) is set to make its trading debut on Thursday.
The offering is a placement of 27.75 million shares to the public at S$0.20 each, raising gross proceeds of S$5.6 million, according to the prospectus. In total, LS 2 Holdings will have 185 million shares, the filing said.
The proceeds are earmarked for strengthening the company’s market position in Singapore, expanding service offering, strategic acquisitions and joint ventures and investing in equipment and technology as well as for working capital, the filing said.
Singapore-based LS 2 Holdings is an environmental services provider, specialising in cleaning services, but also offering pest control and waste-management, the prospectus said.
The company’s clients include both public and private sector entities, including town councils, facilities managers for commercial and private residential properties, public and private education institutions and private companies, the filing said. LS 2 Holdings has around 2,000 employees, the filing said.
“We believe that the Covid-19 pandemic has resulted in a higher demand for cleaning services and presents an opportunity for our group to grow our existing business,” LS 2 Holdings said.
“We intend to expand our existing business in Singapore by increasing our business development activities by reaching out to property developers and asset managers, expanding and upskilling our workers, tendering for higher margin projects in the private sector and attracting new customers to further broaden and diversify our customer base,” the company said.
The controlling shareholders are Roger Tan and Alvin Ong, who will hold 65 percent and 20 percent of the company’s shares post-listing, respectively, LS 2 Holdings said.
Eight shareholders were allotted 5 percent or more of the placement shares: Kong Chan, Leung Chun Ming, Wong Tai Kuen, Best Cosmo Holdings, Deng Hai, Star Spring Holdings, Leung Kam Fai and Liu Xing, the filing said. Altogether, they were allotted 20.73 million shares of the public tranche of 27.75 million shares, the filing shows.
For the first half of 2021, LS 2 Holdings said its profit before income tax was S$1.99 million, down from S$4.08 million in the first half of 2020, as revenue fell 9.8 percent on-year and depreciation, finance and other expenses rose, the filing said. The revenue decline was due to the completion of two existing contracts from the private sector, which lapsed in 2020, the filing said.