Home-grown foodcourt operator Koufu has lodged a draft prospectus for an initial public offering (IPO) on the mainboard, with plans to start trading on July 18.
Koufu was founded by executive chairman and chief executive officer Pang Lim in 2002.
He began working straight out of primary school at 13, and became a coffee shop owner in 1990, sharing the rent collected with his younger brother and uncle. They managed the drinks stall together and rented out the other stalls.
Mr Pang called his business Aik Hua and sold it off in 2002, before unveiling Koufu. His wife and executive director, Madam Ng Hoon Tien, is a co-founder.
Today, Koufu manages 47 foodcourts, 14 coffee shops, one hawker centre as well as a mall, Punggol Plaza, in Singapore. It also has a foodcourt in Macau.
Plans are under way to open a Koufu foodcourt at Sengkang General and Community Hospitals and a Supertea food and beverage kiosk at Marina Bay Sands next month.
Koufu's net profit last year was $26.8 million, up 3.8 per cent from 2016. Revenue was steady at $216.7 million.
Although it has no fixed dividend policy, Koufu intends to recommend dividends of at least 50 per cent of net profit after tax in 2018 and 2019.
This will exclude an interim dividend of $12.5 million that has already been paid by Koufu this year.
Koufu plans to use a significant portion of the IPO proceeds to build an integrated facility to house a larger central kitchen. The rest will fund F&B outlet revamps and other expansion plans.
The IPO comprises an offering of new shares as well as a sale of vendor shares by Koufu's sole shareholder, Jun Yuan Holdings, which is controlled by Mr Pang and Madam Ng. The two have agreed to a six-month lock-up period.
Koufu has three cornerstone investors: Maxi-Harvest Group, Qilin Asset Management and One Hill Investments, which is affiliated to the Ho Bee Group's family investment management vehicle. The cornerstone investors are not subject to any lock-up restrictions.
DBS is the sole issue manager, bookrunner and underwriter for the IPO. UOB is the co-manager and sub-underwriter.
Koufu's IPO follows a string of F&B IPOs last year. The latest additions were restaurant chains RE&S and No Signboard Holdings in November. Both trade under water from their debut prices.
But Kimly, a Catalist-listed coffee shop operator, has risen 52 per cent since its IPO in March last year, and trades at a trailing price-to-earnings ratio of 20.5 times.
Kimly shares added 4.11 per cent yesterday to finish at 38 cents.