Global Yellow Pages in ice-cream business deals
Buying of rights held by Wendy's Supa Sundaes, Innovation Ice Cream
GLOBAL Yellow Pages has agreed to buy the intellectual property rights including recipes and formulas held by Wendy's Supa Sundaes (WSS) and Innovation Ice Cream (IIC) for A$10 million (S$11.67 million).
The sellers are ultimately owned substantially by private equity firm Navis Capital Partners, which acquired the business in July 2006. The Singapore-listed company believes there is "significant potential for further expansion of the ice-cream retail business in Asia", especially in China.
Its indirect wholly owned subsidiary, Global Food Retail Group, had entered into the sales and purchase agreement on Sunday.
The deal is to be paid in cash on completion of the proposed acquisition from proceeds of the company's rights issue completed in June this year.
In May last year, Global Yellow Pages indicated plans to expand its operating base and enhance shareholders' value through diversification of its business.
As part of this strategy, the firm invested in Yamada Green Resources Limited, a major supplier of edible fungi, operating one of the largest mushroom cultivation bases in Fujian Province, China, in June last year.
The latest move is a continuation of the firm's strategy to invest in the food and beverage sector.
Net tangible assets per share for Global Yellow Pages is expected to be 2.81 Singapore cents after the acquisition, down from the 4.52 Singapore cents before the deal.
Earnings per share are estimated to rise to 1.12 Singapore cents from the 0.81 Singapore cents before the acquisition.
Separately, Global Food entered into a conditional master intellectual property licence agreement with Asia Food Retail Group Pte Ltd on the same day.
The Wendy's Supa Sundaes has been around for more than 30 years and comprises a store network of more than 240 stores across Australia and New Zealand.
The IIC recipes are used to manufacture high quality cold dessert products such as ice-cream, slushy, powder products, frozen yoghurt and sugar-infused fruit products.
As at end June this year, the book value of the intellectual property rights and related intangible assets in the accounts of both Wendy's Supa Sundaes and IIC were A$6.4 million. For financial year ended June 2014, the net profit attributable to the intellectual property rights was A$1.67 million.
The stock of Global Yellow Pages closed trading unchanged at 4.8 Singapore cents on Monday.
