GS Holdings, the centralised commercial dishware washing company, says its indirect wholly-owned subsidiary Hao Kou Wei (HKW) has entered into a joint venture agreement with Xing Zhiyuan on Oct 8.
The JV company will be incorporated in Singapore with an issued and paid-up share capital of $20,000 comprising 20,000 ordinary shares.
Hao Kou Wei will hold a 51% stake in the JV company, while Xing will hold the other 49%.
The consideration payable by Hao Kou Wei of $10,200, will be fully paid in cash, and funded by internal sources.
In a filing on SGX, GS Holdings stated that the JV company will be primarily used for the “developing, franchising and management of various food and beverage brands, including the central procurement of contractors, equipment, payment systems, supplies, services, utensils and other related products and services”.
The company’s businesses will be mainly carried out in Singapore.
Under the agreement, Hao Kou Wei will be responsible for hiring a management team to run the business and day-to-day operations of the JV company. It will also provide a shareholder’s loan to the JV company of up to $500,000 as working capital, free of interest.
The JV partner, Xing, is a Chinese citizen and a business with “extensive experience” in the food and beverage industry.
According to GS Holdings, Xing has, through holding companies, established café chain Email Coffee, Xing Shao Ye, a Chinese pancake brand valued at RMB250 million ($50.1 million), and other businesses.
Xing’s role in the JV Company is to create new brands for the JV company with the benefit of his own prior experience in the food and beverage business.
Xing does not currently own any shares in GS Holdings itself.
Shares in GS Holdings closed flat at 57 cents on Oct 8.
