Coffeeshop operator Kimly, listed on the Catalan Stock Exchange, announced today (May 11) in a message from the Singapore Exchange that it has entered into an acquisition agreement with Tenderfresh founders Soh Chun King, Koh Siew Tin and Chew Kian Ho.
As part of an effort to expand its presence in the local halal food industry and at the regional level, the company has acquired a 75 percent stake in local grocery store Tenderfresh for S $ 54 million.
Of this, S $ 38 million will be paid out in cash, while the remaining S $ 16 million will be covered by the issue of 51.2 million Kimly shares at an issue price of 31.24 cents.
The proposed acquisition includes central kitchens, restaurants, kiosks, food stalls, plants and equipment, brands and customer relationships that are operated through different units.
Kimly has also given Tenderfresh sellers a put option, which in turn has given Kimly a call option. Both the put and call options are "evergreen" and allow Kimly to acquire the remaining 25 percent stake in Tenderfresh five years after the completion date.
Kimly expects the proposed acquisition to be completed within the next five months.
The Tenderfresh business will be restructured and consolidated prior to the closing of the transaction. A new entity is formed to hold the business, which Kimly will own 75 percent.
Advances in the Halal Industry
Tenderfresh was founded in 1979 and specializes in fried or roasted spring hens and chicken wings.
It started as a street vendor booth at the Whitley Road Hawker Center in the 1970s, but quickly owned by 2020. It owns 18 F&B brands and 64 points of sale including grocery kiosks, catering, retail stores, and Original Equipment Manufacturing (OEM).
Some of his brands are Amigos, ToriGo !, Tenderbest, Golden Rooster and i chicks.
It also operates a 25,000-square-foot central kitchen that serves approximately 140 brands and outlets. The kitchen also supplies semi-finished products to its own outlets.
"As more and more food and beverage manufacturers seek to outsource their food production to reliable OEM partners to reduce staffing requirements, the group believes this will create new revenue streams," said Kimly.
With Tenderfresh's central kitchen being Halal certified, Kimly believes that she can use this and its wide network in the Halal food market to make further advances in the industry.
The halal brand and standard in Singapore are also recognized by Brunei, Indonesia and Malaysia, according to Kimly.
This new acquisition is not their first encounter together. Last November, Tenderfresh developed a new halal coffee shop concept at Clementi together with Kimly Kedai Kopi.
This isn't Kimly's first acquisition either. In June 2020, six grocery stores were acquired for S $ 35.5 million, including two coffee shops, three industrial canteens and a restaurant unit.
Many other larger F&B companies also buy over the smaller operators over the years.
Some other notable acquisition deals in the local F&B industry are the Jumbo Group and Kok Kee Wanton Noodle for S $ 2.1 million in cash and stock; and electronics company Aztech Group's acquisition of Kay Lee Roast Meat for S $ 4 million in just 10 minutes to seal the deal.
Selected image source: Kimly Coffeeshop / Daniel Food Diary