A small group of key Breadtalk Group stakeholders, including founder and chairman Dr George Quek, have offered to acquire all the ordinary shares in the firm and delist the company.
The group, including Quek’s wife Katherine Lee and existing shareholder Minor International, has formed a new company BTG Holding Company which aims to buy all the shares in Singapore-listed BreadTalk which has just posted a US$3.7 million loss for the year.
Minor International is a Thai-based multinational food & beverage and hotel operator, whose food businesses include The Coffee Club, Sizzler, Dairy Queen and franchises in some markets for Bonchon and Burger King.
The new company will be 74.9-per-cent owned by Dr Quek and related parties and 25.1-per-cent owned by Minor.
Mint and Quek say they plan to undertake a review of the business following its delisting with a view to streamlining such business activities, refocus on and strengthen core business activities and explore the potential disposal of non-core property assets.
Poor performances in China and Thailand have been implicated in the firm’s losses, as has the effect of social unrest on its businesses in Hong Kong. The current coronavirus outbreak is expected to continue to affect operations going forward.
BreadTalk Group operates established food brands, including BreadTalk, Toast Box, Food Republic and Din Tai Fung, together numbering more than 1000 outlets.
“I believe in the growth potential of the BreadTalk brands, building on today’s solid network of outlets and underpinned by Asia’s continued rise in household income,” said Quek.
Group CEO of Minor International, Dillip Rajakarier, said hsi company has invested in BreadTalk Group since 2012 because it believes in the brands and the company’s potential. “Today, we are delighted to further strengthen our partnership with Dr George Quek. With BreadTalk Group’s strong brand recognition, market knowledge of Singapore and China and expertise in the food industry, we have a strong growth platform.”
The offer is being made under expectations that privatisation will allow greater flexibility, as well as ease of management, with significant funding saved on maintenance costs involved with remaining a listed firm. It will only go ahead if acceptances are received for 90 per cent of the shares by the time the offer closes, but given Quek and Minor between them currently hold 70.5 per cent of the shares, acceptance would seem to be a formality.