Sheng Siong in deal to run China supermarkets

Singapore

SINGAPORE-LISTED Sheng Siong Group has executed a conditional joint-venture agreement with Kunming LuChen Group Co to operate supermarkets in China.

In an announcement on Saturday, Sheng Siong said that the agreement was made with both the LuChen Group as well as its executive director Tan Ling San.

Under the deal, the proposed joint venture company will be incorporated in China with a registered capital of US$10 million.

Sheng Siong is to fork out US$6 million for 60 per cent equity interest in the joint venture company, while the LuChen Group will provide cash of US$3 million for 30 per cent of the equity interest. Mr Tan will hold the remaining 10 per cent stake for US$1 million.

He is responsible for the administration and implementation of Sheng Siong's policies and strategies, and evaluating new growth areas for business. Mr Tan had founded and served as the executive chairman of PSC Corporation.

Sheng Siong said that the conditional agreement remains subject to the approval of the Chinese authorities. LuChen, established in 1954, is involved in the manufacture and distribution of food products such as sauces and condiments.