Kimly unit enters joint venture to operate coffeeshop at Kitchener Complex
Sharanya Pillai
KIMLY Makan Place (KMP), a wholly-owned unit of Catalist-listed Kimly , has entered a joint venture with a fellow food court specialist to operate and manage an HDB coffeeshop lease at Kitchener Complex on 808 French Road.
The joint venture is with 808 Ta Sun, which runs food courts, coffeeshops and eating houses, and is solely owned by Singaporean Tang Hwee Fong.
The joint-venture company, Da Sun Food House, will be 49 per cent owned by KMP, while the remainder is held by 808 Ta Sun. KMP paid S$147,000 for its stake, as well as a S$980,000 lease assignment fee, adding to a total consideration of S$1.13 million fulfilled in cash.
The joint-venture company will enter a service agreement with KMP, which will operate and manage the coffeeshop. Da Sun Food House will have 2 directors, with 1 director each nominated by KMP and 808 Ta Sun. The chairman of Da Sun Food House’s board will be appointed solely by KMP.
The deal is in line with Kimly’s strategy to expand its network of food outlets in Singapore and establish new outlets as and when suitable strategic locations become available, the company said.
“The group will be able to diversify and expand its revenue stream through additional and recurrent rental streams, which mitigate the uncertainties in the private leasing category,” it added.
Kimly expects to open more food stalls under its food retail division, complemented by its central kitchen. The company said it will continue to explore opportunities to acquire or operate more strategically-located coffeeshops in mature estates with established footfalls.
The joint venture is not expected to have any material impact on Kimly’s earnings per share or net tangible assets per share for the current financial year. Shares of Kimly closed flat at S$0.38 on Thursday (Jun 30).
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