SATS unit enters deal to buy majority of Thai food company for S$21m

SATS (Thailand) Co, an indirect subsidiary of in-flight caterer SATS, has entered an agreement with Thailand-listed Bangkok Ranch to buy 85 per cent of a food-manufacturing facility owner for 484.5 million baht (S$21 million).

The target company is Food City, whose main asset is a food production facility in Pathumthani, Thailand. Post-acquisition, the facility will be configured to focus on the production of 90,000 ready-to-eat meals per day, SATS announced in a Tuesday bourse filing. Set up in 2016, the facility covers a land area of 30,000 square metres.

With this acquisition, SATS will own interests in 32 meal-production facilities in markets such as China, India, Indonesia, Japan, Macau, Malaysia, Maldives, the Philippines, Singapore, Taiwan and Thailand.

SATS added that it has been investing in large-scale kitchens and food technologies to increase productivity and reduce wastage.

Based on Food City's unaudited accounts as at end-April, the book value and net tangible asset value of the company are each about 521.5 million baht. The acquisition is not expected to have any material impact on SATS' earnings per share for the financial year ending March 2022.

Shares of SATS closed at S$4.05 on Tuesday, up 1 per cent.