Food Empire to get up to $54 million from new strategic investor Ikhlas Capital
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With the tie-up, Food Empire aims to develop and expand its business in South-east Asia and South Asia.
PHOTO: LIANHE ZAOBAO
Michelle Zhu
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SINGAPORE - Food Empire Holdings has signed up a strategic investor, which includes former CIMB chairman Nazir Razak, to develop and expand its business in South-east Asia and South Asia.
The food and beverage manufacturer announced on June 24 that it had signed a non-binding term sheet to issue Asean private equity fund manager Ikhlas Capital Singapore up to US$40 million (S$54 million) in redeemable exchangeable notes.
The founding partners of Ikhlas Capital Singapore include its chairman, Mr Nazir; its chief executive, Mr Kenny Kim, who is the former CIMB Group chief financial officer; Mr Gita Wirjawan, Indonesia’s former minister of trade; and Mr Cesar Purisima, former secretary of finance of the Philippines.
Ikhlas Capital is licensed by the Monetary Authority of Singapore and has on-ground presence in Singapore, Kuala Lumpur, Jakarta and Manila.
The fund manager focuses on growth, transformation and cross-border value creation.
Ikhlas Capital’s investment will be made into a special purpose vehicle (SPV) that is wholly owned by Food Empire.
It will come with the option to hold a portfolio of business operations, including Food Empire’s South-east Asian and South Asian businesses.
The mainboard-listed group said it intends to expand its business in these regions through its partnership with Ikhlas Capital.
As Food Empire’s strategic investor, Ikhlas Capital will inject an initial US$40 million capital in the SPV via a five-year redeemable exchangeable note, and a 5.5 per cent annual interest based on terms and structures to be finalised in a definitive agreement.
The deal will give Ikhlas Capital the right, but not obligation, to exchange the notes into new Food Empire shares at $1.09 apiece.
Proceeds from its new strategic partnership and proposed note issuance will be used to drive Food Empire’s capital expenditures, as well as mergers and acquisitions in South-east Asia and South Asia.
“The board believes that beyond capital injection, Ikhlas Capital’s local presence, knowledge and network in South-east Asia will help the group further accelerate growth and scale in South-east Asia and internationally,” said Food Empire.
It also highlighted Ikhlas Capital’s founding partners as “well-known Asean professionals who have spent a combined total of more than 100 years of their careers in the region, and are highly recognised leaders in their respective professional fields and countries”.
Shares of Food Empire closed up three cents, or 3 per cent, at $1.04 on June 24. THE BUSINESS TIMES
