Sarawak: Sarawak-based telecommunications service provider Reach Ten Holdings Bhd plans to triple its fibre optic duct infrastructure to 767 kilometres (km) in Sibu, Miri and Bintulu within three years utilising its initial public offering (IPO) proceeds. Managing director Leo Chin said as of today, the company has built more than 200km of fibre optic duct infrastructure in Kuching and Samarahan.
According to BERNAMA News Agency, Chin stated that the company aims to expand into Sibu, Miri, and Bintulu within three years for an additional 550km of duct infrastructure with the IPO proceeds. He mentioned this during a press conference after the company's listing ceremony. Chin also indicated that the company expects its satellite-based communication networks and services segment to remain the main contributor to revenue despite the growth potential of the fibre optic communication segment.
He explained that due to Sarawak's vast landmass and challenging terrain, satellite services remain the preferred option for delivering connectivity to underserved communities. Chin added, "Many people consider satellite a sunset industry, but if you look at this industry on a global scale, its growth is still optimistic, with significant investments still being made in the sector. We don't expect major changes in the revenue contribution or ratio from what we are seeing today, but in three years to five years, we may start to see some changes."
Reach Ten debuted on the Main Market of Bursa Malaysia today. Its shares opened flat at 52 sen, with 7.26 million shares traded. The company raised RM104 million proceeds via its IPO, with RM60 million (57.7 per cent) designated for expanding its existing fibre optic communication networks infrastructure in Kuching and establishing three new fibre optic communication networks infrastructure in Miri, Sibu, and Bintulu.
Additionally, RM25 million (24 per cent) will be allocated for constructing 100 new 4G and/or 5G telecommunication towers across Sarawak, especially in Miri, Sibu, and Bintulu, to support the state government's initiatives to expand Internet coverage and connectivity, especially in rural areas.
"Part of the proceeds amounting to RM4.3 million (4.1 per cent) will be used to enhance its satellite-based communication networks and service capability by acquiring additional mobile and fixed satellite terminals, hardware and software, as well as enhancing its facilities in the teleport. The remainder of the proceeds will be used for working capital requirements amounting to RM5 million (4.8 per cent); RM1.7 million (1.6 per cent) to repay bank borrowings, and the remaining RM8 million (7.7 per cent) to defray the estimated listing expenses," the company said in a statement.
At 5 pm, Reach Ten closed its first trading day at 54 sen, up two sen from its issue price of 52 sen. The company was the most actively traded stock today, with 133.89 million shares changing hands.