Kimly announced that its wholly-owned subsidiary, Kimly Makan Place (KMP) on June 30, has entered into a joint venture agreement (JVA) with 808 Ta Sun in relation to the operation and management of the short-term Housing and Development Board (HDB) coffee shop lease of the coffee shop located at 808 French Road #01-3 Kitchener Complex Singapore 200808 (808 French Road Coffeeshop) leased by the joint venture company, Da Sun Food House.
Da Sun Food House was incorporated by 808 Ta Sun on January 7, having an initial issued share capital of $100 comprising 100 ordinary shares.
Da Sun Food House will be allotting 147,000 ordinary shares to KMP and 152,900 ordinary shares to 808 Ta Sun, at a consideration of $147,000 and $152,900 respectively.
Following this, KMP will hold 49% of the shares in the Da Sun Food House, whilst 808 Ta Sun shall hold the remaining 51% of the shares in Da Sun Food House.
The total consideration to be paid by KMP for 49% of the shares in Da Sun Food House is $147,000. The lease was originally held by 808 Ta Sun.
For the purposes of the joint venture agreement entered into with 808 Ta Sun, the new lease with HDB for the 808 French Road Coffeeshop has been entered into by the Da Sun Food House, with the Da Sun Food House being principally engaged in the business of letting and operating self-owned or leased food courts, coffee shops and eating houses.
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808 Ta Sun is a private company incorporated in Singapore on May 11, 2015, and has an issued and paid-up share capital of $10,000 comprising 10,000 ordinary shares.
Upon completion of the subscription and allotment, KMP shall hold 147,000 ordinary shares representing 49% of the issued share capital of the Da Sun Food House.
Da Sun Food House will enter into a service agreement with KMP, and KMP will operate and manage the 808 French Road Coffeeshop.
KMP has also paid to 808 TS a lease assignment fee that was arrived at on a willing buyer willing seller basis, taking into various factors such as the market rent for comparable leases based on location, size and current rent paid.
The aggregate consideration payable by KMP for the 49% interest in the issued share capital of Da Sun Food House is $147,000 and the lease assignment fee is $980,000, totalling to $1.1 million.
The entry into the joint venture agreement is not expected to have any material impact on earnings per share or net tangible assets per share of the Group for FY2022 ending September.
Shares in Kimly closed flat at 38 cents on June 30.
