Dutch tea and coffee giant Jacobs Douwe Egberts (JDE) has lodged a RM1.47 billion (S$488 million) bid to buy Malaysia-listed coffee company OldTown.
JDE is offering RM3.18 per share for the operator of OldTown White Coffee chain, which has 232 outlets, the companies said in a statement on Monday. OldTown has 189 outlets in Malaysia and nine in Singapore, with the others spread across Indonesia, Australia, China, Hong Kong and Myanmar.
Local celebrity Mark Lee, a prominent comedian and TV host, had brought the chain to Singapore.
The offer price represents a 10.42 per cent premium over OldTown's last trading price last Thursday, before the offer was announced. It also marks a premium of 16.45 per cent over the volume weighted average market price of the shares for the five-day period up to and including the announcement.
OldTown shares closed 6.94 per cent up at RM3.08 yesterday.
The offer will be conditional once JDE receives acceptances from shareholders that result in it holding over 50 per cent of all OldTown shares. JDE plans to delist the firm.
OldTown shareholders accounting for 51.45 per cent of the firm have agreed to accept the offer, said the statement. They include Mawer Investment Management, which holds a 7.5 per cent stake as OldTown's biggest institutional investor.
The acquisition would be JDE's second such deal in Asia in recent years, following its $1.45 billion buyout of Singapore-based Super Group with its famed 3-in-1 coffee mixes.
JDE - whose brands include Jacobs, Tassimo, Douwe Egberts and Kenco - is part of European investment firm JAB Holding Company, which has built up a global coffee business through a string of deals over the past few years.
JDE chief financial officer Fabien Simon noted that OldTown has developed "an impressive footprint... across the Asia-Pacific region". "We see huge potential in the business."
Mr Lee Siew Heng, group managing director and founding shareholder of OldTown, said the acquisition will help take the company to the next level to "accelerate the creation of more shareholder value".
Evercore was the exclusive adviser to OldTown and architect of the transaction. It was also the exclusive adviser to Super Group on its takeover by JDE.
Mr Keith Magnus, chairman of Evercore for Asia, said: "The proposed offer unlocks substantial value for all shareholders."
Evercore did not disclose if Mark Lee is a shareholder of OldTown, but told The Straits Times he is OldTown's partner for the cafe operations in Singapore, and that "it will be business as usual for outlets and operations in Singapore".
