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Engineering firm Ellipsiz inks JV for ready-to-eat meals, to support its vending machine business
ENGINEERING services provider Ellipsiz plans to trade in ready-to-eat meals, in a joint venture agreement with a celebrity chef that was signed and announced on Thursday.
Kalms SG, an Ellipsiz associate that distributes ready-to-eat meals in vending machines, will partner chef Justin Quek's JQ Global restaurant consultancy in a 50-50 joint venture, according to a bourse filing.
The planned business will see Kalms SG and JQ Global, through new joint-venture company Chef & Chefs, getting ready-to-eat meals and then selling them to Kalms SG, its nominees, or third-party buyers.
In giving the rationale for the deal, the board of Ellipsiz said that the joint venture would "achieve operational synergies", because a company that is 60 per cent-owned by Kalms SG can make the ready-to-eat meals in its kitchen facilities.
Kalms SG would also become "the exclusive seller of a premium brand" of such food products, it added.
"The vertical integration will give Kalms SG more control over the range and diversity of its products and enable it to reap gains through its direct involvement from production to sale."
Ellipsiz has a 50 per cent stake in the unit that owns 90 per cent of Kalms SG.
The board noted that the incorporation of C&C was funded by Kalms SG's internal resources, and said that it is not expected to have any material impact on the group's consolidated earnings and net tangible assets per share for the year to June 30, 2019.
Ellipsiz last closed up by half a Singapore cent, or 1.12 per cent, at S$0.45, before the announcement.