Minimart king hits billionaire status in Malaysia’s hot IPO market

LEE Thiam Wah’s first retail venture was selling snacks from a roadside stall in Malaysia. Several decades later, the entrepreneur has transformed that humble beginning into a sprawling retail empire of more than 2,600 convenience stores across the nation.

On Monday (Sep 9), the 60-year-old was minted as a billionaire after his company 99 Speed Mart Retail Holdings goes public in Kuala Lumpur.

The US$531 million initial public offering (IPO) is Malaysia’s largest in seven years. At the IPO price of RM1.65 per share, Lee’s fortune is about US$3.3 billion, according to the Bloomberg Billionaires Index.

The listing cements Kuala Lumpur as the busiest location for market debuts in South-east Asia this year and shows investor optimism in the nation’s growth potential. The firm’s shares are seen as a way to build exposure to the consumer sector in an economy that’s projected to expand as much as 5 per cent this year.

“It comes at a crucial moment for both Malaysia’s IPO landscape and South-east Asia’s capital markets,” said Mohit Mirpuri, a senior partner and fund manager at Singapore-based SGMC Capital. “This could boost market sentiment and position Malaysia as a key player,” in regional listings.

Little shop empire

Lee was born in 1964 in Klang, one of several cities littering the stretch between Kuala Lumpur and the shores of the Malacca Strait. His father, a construction worker, and his mother, a hawker, had 11 children and could only afford to send Lee to school for six years.

His first retail venture – that roadside stall – was born of necessity. As a child, he contracted polio and permanently lost the use of his legs.

“Nobody would hire me due to my physical limitation,” he told Forbes in 2012. “I have to help myself.”

Lee opened a grocery shop in 1987 and a decade later he was running eight stores under the name Pasar Mini 99, where his wife, Ng Lee Tieng, 44, started her career as a purchasing executive in 1997. Until the IPO, the couple were the company’s sole owners.

Today, the chain is the largest of its kind in Malaysia, holding a 40 per cent share in the mini-market segment and nearly 12 per cent among all grocery retailers, according to the IPO prospectus.

Lee’s “journey is an inspiring example for small business owners, showing that with determination, perseverance and a customer-focused approach, it’s possible to scale a business, even from humble beginnings”, said SGMC’s Mirpuri.

Lee will remain as the company’s chief executive officer. The 99 Speed Mart chain forms the bulk of his net worth, along with cash collected from dividends and the share sale.

He also holds stakes in multiple closely held businesses, including the sole Malaysian franchisor of Burger King restaurants. Last year he also briefly emerged as one of the biggest individual shareholders in Alliance Bank Malaysia with a roughly 5 per cent stake, regulatory filings show.

Bullish market

As the FTSE Bursa Malaysia KLCI Index equities benchmark heads to its best year since 2010, listings are back after years of lacklustre growth.

99 Speed Mart’s listing attracted 14 cornerstone investors that included abrdn Asia and UOB Asset Management (Malaysia).

About 28 per cent of the proceeds from the IPO will go to the company, which plans to setup new outlets and distribution centres, purchase delivery trucks and repay loans, according to the prospectus. The company posted a profit after tax of RM133.2 million (S$40 million) on revenue of RM2.4 billion for the first three months of 2024.

The mini-mart operator’s tagline ‘Near n’ Save’ is part of a business model that emphasises convenience and easy access for consumers, said Arun George, an analyst at Global Equity Research who publishes on the platform Smartkarma.

The scale of the firm’s operations create a barrier to entry and expansion for other mini-market players in Malaysia, “hindering their ability to compete effectively”, he said. BLOOMBERG