It looks like the end of an era for Singapore's best-known beauty outlets for women, the Mary Chia chain of stores. It also marks an eye-catching diversification for Japanese restaurant group Suki Sushi.
Shares of beauty and wellness firm Mary Chia Holdings soared last Friday after a mandatory general offer for the company was triggered on Thursday by Suki Sushi.
The stock charged up 68.7 per cent in early trade before closing 4.3 cents higher at 11 cents, with 3.75 million shares changing hands.
Mary Chia Holdings, which opened its first shop here in 1988, is helmed by its driven and ambitious namesake, Madam Mary Chia, and her daughter, Ms Wendy Ho Yow Ping. The mandatory offer for Singapore's best-known beauty business was triggered after Suki Sushi, a company owned by Ms Ho and her husband, significantly increased its holdings.
This meant that Suki Sushi, which runs Japanese restaurants here, controlled at least 30 per cent of the voting rights, which required it to make a general offer.
Suki Sushi took on Ms Ho's 19.99 per cent of the beauty firm, and lifted this to 80.97 per cent on Thursday, when it paid Madam Chia $11 million for her 60.98 per cent stake. Suki Sushi is offering 11.1 cents a share for all the stock it does not already own. The offer closes late next month. The beauty firm has said it will "undertake a strategic and operational review of the group's business".
Madam Chia has resigned as executive chairman and from all other executive positions in the group with immediate effect. She will also step down as a director after the offer closes.
The buyout marks the end of a significant chapter in the beauty business here, in which the mother-daughter team became synonymous with beauty and with doing away with traditions in the industry such as upfront pre-paid packages.
For instance, its Japanese-inspired concept store Mentsu gave consumers the flexibility of buying beauty products and treatments as and when they liked. In 2003, it released a spa brand for men called Urban Homme. It expanded its offerings in 2011 when it teamed up with JL Asia Resources, owned by Ms Ho's husband, Mr Jason Lee, to open the 84-room boutique Porcelain Hotel in Mosque Street.
However, in recent years, Mary Chia Holdings has been plagued by controversy. In February, Ms Ho, who is the chief executive of Mary Chia Holdings, was fined $2,600 for employing three foreign women in massage establishments without prior written approval.
Then last month, a Mary Chia unit was ordered to pay more than $580,000 in damages and costs over a joint venture gone sour.
The firm told the Singapore Exchange in a filing earlier this week that it "has been operating within a challenging environment", incurring net losses of $5.7 million in the financial year ended March 31.
It was in a negative working capital position of about $10.3 million as at March 31.
Beauty services are increasingly popular but the firm has had to cope with increased competition as more aesthetic clinics and facial, hair and nail salons open. High rents and cheaper options may have also hurt the company.
Suki Sushi said, in its offer announcement on Thursday, that it will use Mr Lee's "industry network, experience, expertise and resources" to look for new opportunities and diversify its business.
Mr Lee, who is in his 50s, and his firm were unavailable for comment but an article in The Edge magazine in 2014 showed his entrepreneurial nature. He helms the JForte Group of Companies, which ran the popular karaoke chain K Box Entertainment Group before selling it to a Japanese group in March 2014.
Mr Lee developed the 106-unit condominium Forte Suites near Farrer Park, and The Edge said then that he "could well be on track to become another Ching Chiat Kwong of Oxley Holdings, James Koh of Fragrance Group or some version of the two", referring to the boutique developers.
It noted that he was the 11th of 12 children in a family that grew up in a kampung in Ang Mo Kio and helped out at his parents' vegetable stall in Ghim Moh Market.
Asked if he would ever list his group of firms, Mr Lee told The Edge: "If the timing is right. We try to build something different from others, so even in the worst crisis, we can survive."
