SINGAPORE (Sept 2): BreadTalk Group is acquiring the entire issued share capital of Food Junction Management (FJM) for $80 million, subject to further adjustments.
A sale and purchase agreement was signed between BreadTalk unit Topwin Investment Holding and seller Food Junction Holdings (FJH) on Friday.
The target group consisting of FJM and its wholly-owned subsidiaries Food Junction Singapore and T&W Food Junction are in the business of operating food courts and F&B outlets in Singapore and Malaysia.
It operates a network of 12 food courts in Singapore and three in Malaysia, with an additional one scheduled to open in 2020 at The Mall, Mid Valley Southkey.
The consideration values FJM at 6.5 times the net asset value of the target group of $12.3 million as at June 30 and 25,133 times its earnings of $3,183.
BreadTalk says the proposed acquisition will provide the group with access to FJM’s existing network of food courts and F&B outlets, allowing the group to both obtain additional revenue streams and benefit from the synergies with the group’s existing food court and F&B outlet business through the streamlining of costs and sharing of resources.
FJH is an investment holding company that is 98.10% owned by Auric Pacific Group (APGL), a Singapore incorporated investment holding company involved in a diverse range of businesses, which include food manufacturing and retailing, restaurants as well as food court management.
Lippo, through Lippo’s wholly-owned subsidiaries and non-wholly owned subsidiaries holds 74.99% of Lippo China Resources (LCR). In turn, LCR, through its wholly-owned subsidiaries and non-wholly owned subsidiaries, holds 50.3% of APGL.
The remaining 49.7% of APGL is held by the chairman and executive director of Lippo and LCR, Stephen Riady, and his son-in-law, Andy Adhiwana through companies owned by each of them respectively.
BreadTalk says the consideration was arrived at after arms’ length negotiations, on a willing-buyer, willing-seller basis and will be paid in cash and will be funded through the group’s internal resources (including available cash on hand) and debt facilities.
The acquisition is condition on approval from the shareholders of BreadTalk, LCR and Lippo.
The company will be making an application to the Consumer Commission of Singapore for a ruling on the proposed acquisition.
Shares in BreadTalk last traded at 68 cents.