CL Synergy Limited has received official approval from the Colombo Stock Exchange (CSE) for its Initial Public Offering, which is set to open on the 7th of April 2022.
The anticipated IPO by one of Sri Lanka’s fast-growing freight forwarding solutions providers will issue an offer for a subscription of 63 million new ordinary voting shares and a sale of 28.5 million existing ordinary voting shares, at an offer price of LKR 14.00 per share.
Managed by Acuity Partners (Pvt) Limited, the issue will offer a total of 91,500,000 shares to raise LKR 1,281,000,000 in funds.
Commenting on the IPO, Roshan Silva – Managing Director of CL Synergy stated, “We work with an array of prestigious local and international clients across several export-oriented industries, and we have built strong relationships with these customers by always going the extra mile. We are extremely pleased to present our IPO, as we gear up for the next stage in our strategy, further allowing us to onboard a wider group of stakeholders on our exciting journey to go above and beyond boundaries.”
The Company expects to be listed on the Main Board of CSE and would be a company representing the lucrative and vibrant Logistics sector in CSE, which is also declared an essential service sector by many governments globally following the new developments.
At the per-share price of LKR 14.00, the implied price-to-earnings ratio (PER) based on forecasted earnings for the upcoming financial year (FY23) stands at 4.6X. Reinforcing CL Synergy’s strong financial footing, 65% of the Company’s revenue is exclusively generated in USD whereas 70% of the revenue comes from the Company’s export-oriented clientele. Furthermore, CL Synergy is an ideal candidate which benefits from currency depreciation, as it has amassed a significant cash reserve and other assets denominated in USD.
Explaining how the capital raised by the IPO will be deployed, Roshan Silva said, “As we embark on our ambitious plans, we intend to allocate approximately LKR 320 million to enhance working capital within CL Synergy, LKR 212 million to reduce long-term debt outstanding, LKR 200 million to expand our regional presence in buyer and sourcing markets, and LKR 150 million towards strengthening our core digital systems such as the online rate and booking platform.”
Established in 2004, CL Synergy Limited is a fully-fledged freight forwarding company and has expanded its freight forwarding activities under a set of Associate companies that are also engaged in Logistics and Freight Forwarding, along with other innovative ventures in the pipeline.