65% of Laem Charoen sold to MK Group

65% of Laem Charoen sold to MK Group

Transaction set for December closing

The Laem Charoen Seafood restaurant at Siam Paragon. At major shopping malls, the chain says 50% of diners are foreign tourists. (Photo by Pitsinee Jitpleecheep)
The Laem Charoen Seafood restaurant at Siam Paragon. At major shopping malls, the chain says 50% of diners are foreign tourists. (Photo by Pitsinee Jitpleecheep)

Laem Charoen Seafood, a 40-year-old Thai restaurant chain, expects stronger business results after selling a majority stake to SET-listed MK Restaurant Group last Friday.

Chaitas Narakulsookpipat, the company's managing director, said the company decided to sell the stake to MK because it is confident the partnership will bring about synergy and improve business.

Laem Charoen has been in the 400-billion-baht Thai restaurant industry for four decades and hopes for sustainable growth with the partnership.

"MK Restaurant is a very successful chain in Thailand because it has expertise and knowledge from being in the business for a long time," said Mr Chaitas.

"The group boasts a vast range of businesses, comprising suki, Japanese and takeaway restaurants, as well as food courts. MK also has high brand loyalty."

MK Restaurant Group informed the Stock Exchange of Thailand (SET) last Friday the group, through Catapult, a 99.99% subsidiary of the group, acquired a 65% stake in Laem Charoen Seafood Co for 2.06 billion baht.

The funding comes from working capital.

The transaction, which is expected to be completed by December this year, aligns with the group's strategy to expand the restaurant business, according to the statement.

"Laem Charoen brand has recognition among tourists. At malls such as Paragon, CentralWorld and EmQuartier, about 50% of customers are foreign tourists," Mr Chaitas said.

There are 26 Laem Charoen Seafood branches in Thailand.

An executive at MK Restaurant Group who requested anonymity said earlier the group has been interested for years in expanding via mergers and acquisitions, bringing in new brands and new channels.

"The latest deal with Laem Charoen will make our food portfolio more varied and help speed up our growth," said the source.

MK Restaurant has over 400 eateries, made up of several brands including MK, Yayoi, Miyazaki, Hakata, Bizzy Box, Le Petit and MK Harvest.

MK Restaurant revenue amounted to 17.2 billion baht in 2018, up from 16.5 billion in 2017, with net profit of 2.57 billion and 2.42 billion in 2018 and 2017, respectively.

For the first half of 2019, revenues from sales and services registered a growth rate of 6.3% year-on-year to 8.82 billion baht.

The group's net profit for the period rose by 8.3% to 1.39 billion baht.

M shares closed yesterday on the SET at 76.50 baht, up three baht, in trade worth 199 million baht.


Do you like the content of this article?
COMMENT (1)

Chinese cops intercept shipment of drug precursor

Chinese police have intercepted a shipment of hydrochloric acid bound for the Golden Triangle region, which will likely affect the production of 3.9 billion methamphetamine pills.

2 Apr 2020

US weekly jobless claims hit record once again

WASHINGTON: The number of Americans filing claims for unemployment benefits last week shot to a record high for a second week in a row — topping 6 million — as more jurisdictions enforced stay-at-home measures to curb the coronavirus pandemic, which economists say has pushed the economy into recession.

2 Apr 2020

Curfew imposed

All people in Thailand are banned from leaving home from 10pm to 4am starting Friday in the government’s latest move to contain the spread of coronavirus.

2 Apr 2020