Breadtalk Deal Could Stir Takeovers Of Other Singapore Companies

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http://blogs.wsj.com/deals/2013/04/11/breadtalk-deal-could-stir-singapore-takeovers-maybank-kim-eng/

With deals in the consumer sector all the rage in Southeast Asia, brokerage Maybank-Kim Eng have this to say: “In a world of record low interest rates against a backdrop of macro uncertainties, acquirers can control their own fate by buying out good assets.”

The latest such deal is the steady building up by Thai hospitality group Minor International PCL of its stake in Singaporean bakery chain BreadTalk Group Ltd. since January. The Thai Group currently has a 9% stake in BreadTalk, which has a market capitalization of about S$275 million (US$222 million).

BreadTalk operates bakeries in Southeast Asia as well as China, Hong Kong and the Middle East. It also operates other eateries such as the Food Republic food courts and the Toast Box chain across Asia.

Maybank-Kim Eng calculates that there have been 54 takeovers or take-privates of listed Singapore companies in the consumer sector in the past 24 months.

The brokerage also found that having a controlling shareholder in these companies was rarely an impediment to a takeover, because acquirers may value buying into a company where existing management is also the founder and controlling shareholder.