RESTAURANT operator Food Innovators Holdings (FIH) is offering 14 million shares at S$0.22 apiece as it seeks to list on the Catalist board of the Singapore Exchange.
The 14 million shares comprise 13 million placement shares to investors and one million public shares. Altogether, the new shares will represent around 10.8 per cent of the company’s enlarged share capital.
FIH will raise S$3.1 million in gross proceeds, with net proceeds amounting to around S$1.1 million.
Of the gross proceeds, about 16.2 per cent will go towards funding the expansion of the group’s food retail business outside of Japan.
Another 16.2 per cent of the gross proceeds will go towards funding acquisitions of new Japanese food brands, as part of the group’s expansion and diversification efforts in Singapore and Malaysia.
This amount also includes the acquisition of operating rights for more themed restaurants based on popular anime characters in Japan. For instance, the group currently holds the Moomin character brand licence and operates a cafe with that theme in Karuizawa.
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“Our rationale stems from the significant demand for anime-themed restaurants, buoyed by the widespread popularity of anime culture in Japan,” said FIH. “Anime serves as a prominent draw for tourists visiting Japan.”
The remaining 3.7 per cent of gross proceeds will go towards general working capital.
Growing popularity of Japanese food
Incorporated in 2019, FIH runs two main business divisions – leasing and subleasing, and a food-retail business.
Its leasing and subleasing division leases restaurant premises from landlords and then subleases them to those seeking to open a restaurant or relocate their existing operations.
The group’s food-retail division sets up and runs restaurants specialising in traditional Japanese and Japanese-inspired European cuisines. It also provides food and beverage (F&B) consulting and operations-management services.
As at August 2024, FIH has 214 subleased properties spanning more than 23,000 square metres in Japan. In addition, it runs a total of 26 restaurants – 12 in Japan, 10 in Singapore, and four in Malaysia. It also runs a bakery cafe and central kitchen in Malaysia.
In Singapore, some of the brands under its portfolio include sushi bar Kadohachi, grilled-meat restaurant Niku Katsumata, and Tendon Kohaku, which serves rice bowls.
Looking ahead, FIH said it intends to capitalise on the growing popularity of Japanese food arising from the “health perception of the cuisine and the permeation of Japanese influence through food and culture”.
The group is eyeing Australia and Vietnam as potential markets for business expansion in the next two years, thanks to their high growth potential and proximity to Japan.
On the leasing front, FIH said it will continue to focus on subleasing properties in the Tokyo metropolitan area and expand the scale of its existing subleasing business.
“Barring unforeseen circumstances and depending on other business considerations, we also have plans to continue expanding in other major cities in Japan,” it said.
Although there are some risks on the horizon – for example, the group’s leasing business is dependent on the health of Japan’s F&B and property industries, and the F&B landscape can be highly competitive – FIH chief executive officer Kubota Yasuaki believes the group’s decades of deep expertise and extensive experience in Japan’s food service industry has given it a unique understanding of market dynamics.
“(This will allow) us to strategically leverage favourable trends and scale our Japanese food restaurant network both domestically and internationally, while maximising synergies across our business segments to boost operational efficiency,” he said.
“We are confident that through our dual-growth strategy, we can enhance our current operations and drive sustained top-line growth.”
Applications for FIH’s shares close at noon on Oct 14. The shares are expected to commence trading on a ready basis at 9 am on Oct 16.
