RESTAURANT operator No Signboard : 1G6 0% has proposed to acquire a majority stake in catering firm Dining Haus for S$1.2 million, the company said in a bourse filing on Wednesday (Jan 10).

The company has entered into a share sale and purchase agreement with Chia Shu Sian – chief executive officer of Dining Haus – and No Signboard’s investor Gazelle Ventures, for the proposed acquisition of 60 per cent of the entire issued and paid-up capital of Dining Haus.

In connection with the proposed acquisition, No Signboard has also entered into a shareholders’ agreement with Chia. The purpose of the agreement is to regulate the relationship between Dining Haus’ shareholders; to set out the basis in which Dining Haus’ business affairs will be managed and controlled; as well as to provide for shareholders’ rights and duties.

Chia owns the entire issued and paid-up capital of Dining Haus and Eat What, a company that provides institutional catering services to clients at industrial sites in Singapore.

According to its website, Dining Haus is an institutional catering and staff cafeteria management company.

It is a private company incorporated on Sep 14, 2022, with an issued and paid-up share capital of S$100,000 comprising 100,000 ordinary shares. As a newly incorporated entity, it does not have prior financials relating to the business and assets to be acquired, noted No Signboard.

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The intention is therefore for Dining Haus to acquire the business and assets of Eat What, prior to the acquisition being completed, said No Signboard. It added that the transfer of Eat What’s business to Dining Haus will be a condition precedent to the completion of its proposed acquisition.

This would involve, for instance, the transfer of Eat What’s customer contracts, business assets, financial records and business goodwill to Dining Haus. But none of Eat What’s liabilities, tax liabilities and bank balances will be transferred to No Signboard, it added.

No Signboard will fund the acquisition with capital from an implementation agreement it had signed with Gazelle in July 2022. The agreement saw Gazelle invest up to S$5 million in the restaurant operator to support its activities.

However, should this implementation agreement be terminated for any reason, all rights, benefits and liabilities due to No Signboard under the sale and purchase agreement shall automatically be transferred without further action to Gazelle.

The consideration was determined based on arm’s length negotiations and arrived at on a willing buyer and willing seller basis. Key factors that were taken into consideration by both parties include Dining Haus’ potential earnings and growth prospects, as well as its existing customers on hand, said No Signboard.

Trading in No Signboard’s shares has been suspended since January 2022.