Food and beverage maker BreadTalk Group on Friday said its unit Together Inc formed a joint venture agreement with Japanese trader Shinmei Co.
Together Inc will own 66 percent in the BTG-Shinmei Venture while the remaining will be held by Shinmei. The JV will focus in the areas of trading and food & beverage, it said in a statement.
BTG-Shinmei will oversee the sourcing, procurement and supply of key raw materials and ingredients, including flour, rice, sugar, dairy, seafood, and product packaging to support the food & beverage operations of BreadTalk's group of companies globally.
The JV company may also potentially source and supply to third parties in future, BreadTalk said.
Under the partnership, BTG-Shinmei aims to ride on BreadTalk Group's regional platform to deliver new food concepts where BTG-Shinmei can similarly support as the dedicated supply chain partner.
The JV will strengthen BreadTalk's position as a leading food & beverage and lifestyle player in the region, with a view to pursuing growth opportunities globally.
"With an annual group-wide purchase value of over S$100 million globally, we see significant near-term potential for the partnership in delivering economies of scale and cost savings to our core F&B businesses," Henry Chu, Group CEO, BreadTalk said in a statement.
The investment is not expected to have any material impact on the earnings per share and net tangible assets of the company and the BreadTalk Group for the financial year ending December 31.
Shares in BreadTalk last traded at S$1.61 on the Singapore Exchange before the commencement of the trading halt. The stock has jumped 44 percent over a year.
