GS Holdings 43A has terminated its joint venture agreement (JVA) with Focaccia Foods.
The JVA was entered into between GS Holdings’s indirect wholly-owned subsidiary, Hao Kou Wei Pte. Ltd. and Focaccia Foods on Nov 1, 2021.
According to GS Holdings, the JVA was mutually terminated due to due to commercial reasons, particularly the poor performance of the JV company.
The joint venture termination term sheet was signed with Focaccia Foods on March 17.
Under the termination agreement, neither party will have any claims against the other with respect to the JVA.
The JV company has an issued and paid-up share capital of $100,000 comprising 100,000 shares which are currently held by Hao Kou Wei and Focaccia Foods equally.
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The operations of the JV company are also currently being jointly managed by both JV partners.
Based on the JV company’s unaudited financial statements for the financial period ended Feb 28, the company mad a net loss of around $1,400 mainly due to the provision for professional fees. The JV company does not presently have any operations since the close of its last food stall sometime on or around June 2022.
Following the termination, Focaccia Foods have its director in the JV company resign. It will also transfer all its 50,000 ordinary shares Hao Kou Wei for a consideration of $21,223. Following the completion of the proposed acquisition, the JV company will become a wholly owned subsidiary of Hao Kou Wei and will be managed entirely by its management.
The consideration is payable in cash and will be funded by the group’s internal resources.
The proposed acquisition will allow Hao Kou Wei to have full business ownership and control of the JV company to facilitate, among others, the potential injection of new businesses into the JV company. It will also allow Hao Kou Wei to implement future business plans that may enhance the value of the JV company.
Shares in GS Holdings closed 1.5 cents lower or 13.51% down at 9.6 cents on March 20.
