Kimly completes acquisitions of six food outlets for S$35.5m

CATALIST-listed coffeeshop consolidator Kimly has completed the acquisitions of six food outlets first announced on Feb 21 for S$35.5 million, and will soon acquire two coffeeshops for S$20.3 million.

Completion of the acquisitions of the two coffeeshops, which are in Block 380 Clementi Avenue 5 and Block 347 Ang Mo Kio Avenue 3, can only take place at a later date once the requisite approvals have been obtained from the Housing Development Board. These have been delayed due to the disruption caused by Covid-19, Kimly said in a filing on Wednesday.

Of the first payment of S$35.5 million, S$5.5 million has been satisfied through the issuance of 22 million new shares at S$0.25 per share, representing a premium of close to 15.9 per cent to the volume-weighted average price of S$0.2102 for Tuesday.

The 22 million new shares represent approximately 1.88 per cent of Kimly's enlarged share capital. They will be listed on the Singapore Exchange from 9am on Friday.

As for the outstanding S$20.3 million to be paid for the remaining two coffeeshops, S$4.5 million of this will be satisfied through the issuance of 18 million new shares at S$0.25 per share at a later date.

Upon completion of the acquisitions, most of the properties will progressively undergo asset enhancements such as layout improvements; they will also have enlarged seating capacities, and new food concepts will be introduced, Kimly said.

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These improvements are aimed at retaining current food stall operators, attracting new ones, as well as serving customers better.

Kimly noted that the outbreak of Covid-19 has changed the landscape of the food and beverage industry, in that people are generally more cost-conscious as a result of the economic impact of the outbreak. 

"The group could benefit as consumers continue to prefer more economical food options in coffeeshops and also opt for more online food deliveries," it said.

Kimly shares closed flat at S$0.215 on Wednesday.