After dash to HK, Ron Sim aims to strike it right with V3 IPO

Singapore

AFTER the initial rush to kickstart the initial public offering (IPO) process for his company in Hong Kong just months after it was delisted here, OSIM founder Ron Sim is biding his time.

V3, Mr Sim's repackaged massage chair and lifestyle products group, got the go-ahead from the Hong Kong Stock Exchange to proceed with an IPO in October last year, he said.

But Mr Sim is in no hurry to make a quick decision. Although V3's IPO application will lapse again at the end of June, he can get that extended to the end of the year for a small fee.

Mr Sim told The Business Times in an interview on Monday: "I'm taking my time because V3's numbers have gotten better and better. We are busy with many private options too, so I'm still thinking about it (a relisting) and I'd rather not give a firm answer."

Mr Sim added: "An IPO is a function of valuations. So if you think your company is doing well, you wait for a better time (to IPO), right?"

Last year, organic growth across all V3's businesses helped it achieve double-digit growth, reversing the revenue decline owing to store closures in China in prior years, Mr Sim said. Revenue has climbed back above the S$600 million mark, and net profit has also risen, he added.

The largest chunk of V3's revenue comes from sales of OSIM massage chairs. V3 also owns luxury tea brand TWG Tea, as well as franchise rights to the GNC nutritional supplements brand in Singapore, Malaysia and Taiwan.

The newest business that V3 bought control of last year is Futuristic, a Singapore-based manufacturer of store fixtures for retailers like Starbucks and Victoria's Secret.

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Futuristic is also the business that Mr Sim spoke most eagerly about.

OSIM's stores need a "lift-up", and Futuristic is working on that, he noted.

He also wants to lead V3 into the live entertainment business. The Futuristic team is not in the business of live entertainment, he admits: "But they are exhibition people, so we have been forming this group since last year."

Right now, Futuristic is awaiting the results of a three-cornered fight for the future of the Singapore Expo.

In January, Futuristic teamed up with sports and entertainment company AEG to submit a S$60 million bid in a government tender to manage the Singapore Expo for 10 years from 2019, BT reported.

Also in the running is Sphere Exhibits, the events arm of Singapore Press Holdings, which publishes BT. Sphere put in a S$60 million bid together with concert organiser Unusual Development.

As it is now, the Expo is "quite dead", said Mr Sim. "I feel that today, most expos are done in very stale or boring ways."

"You have a space, you lease a space... Expos must be done with a vision of who you are targeting. We certainly must target SMEs and trade associations. The expo can be a platform to rally SMEs together to create innovative live content," he explained.

The competition for the island's largest exhibition venue is not without basis - incumbent manager SingEx Venues turned in a profit of S$16.2 million on revenue of S$53.6 million in the 12 months to March 31, 2017.

Separately, in recent months, Mr Sim has picked up minority stakes in a handful of Singapore-listed SMEs including events firm UnUsUaL through a fund managed by R3 Asset Management. R3 has a fund size of S$50 million, of which two-thirds came from Mr Sim.

But R3's holdings are strictly financial investments and separate from V3, Mr Sim said: "They are financial people, we are business people."

As for V3 and its much-anticipated IPO, Mr Sim would not be drawn to commit to a firm timeline. "The simple thing is that valuations must meet my demands," he said.

OSIM International was valued by Mr Sim at S$1 billion based on his buyout price in 2016.

So is he demanding a much-higher valuation now?

"Definitely if you ask me, it will be bigger. That's because my numbers have grown."