Month: June 2021

Business Times | 8 Jun 2021 | Lynette Tan

BAKING supplies retailer Phoon Huat has acquired a majority stake in Le Petit Depot, a Singapore-based online retailer that specialises in French food products.

Phoon Huat now holds 91.5 per cent interest – made up of ordinary and preference shares – in Le Petit Depot, according to corporate records. The remaining shares are held by Le Petit Depot’s founders, Frenchmen Yannick Guédon and Frédéric Douvillé, and a holding firm, Oper8.

However, Phoon Huat told The Business Times (BT) that the preference shares will be considered “quasi debt”, so its stake in Le Petit Depot is essentially 70 per cent.

“The idea is not to give the money to the founders, but to put it into growing the company,” said Phoon Huat chief executive Shuichi Sato. He added that Le Petit Depot’s management will stay unchanged, and that its founders remain “meaningful shareholders in the business”.

Le Petit Depot has paid-up capital totalling S$3.5 million, the records show. The company was started in 2012 and now retails more than 8,000 products, from meats to wine.

In a joint statement on Monday, both businesses said the deal will allow them to “leverage each other’s strengths to grow their online businesses and extend the product range in retail stores under Phoon Huat”. This is as Phoon Huat and Le Petit Depot aim to double their sales volumes in three years.

Both companies will also work on reducing supply chain costs and optimising IT infrastructure. “To achieve efficiency is critical especially in the current environment where all costs are on an increasing trend,” they said.

For instance, a “significant” portion of Phoon Huat’s goods come from France, Mr Sato noted. Consolidating logistics with Le Petit Depot will therefore lead to greater economies of scale.

Phoon Huat hit S$100 million in revenue last year, propped up by a home-baking frenzy amid the Covid-19 pandemic.

But the company had little idea how the year would turn out, as the pandemic situation was fluid, Mr Sato told BT in February.

“It was difficult to have any expectation or prediction (during this period). We worked to handle the changing needs of our customers that were affected by the evolving Covid-19 situation,” he had said.

Phoon Huat currently has 19 retail stores in Singapore and an online shopping site.

Link to article (for BT Subscribers): https://www.businesstimes.com.sg/sme/phoon-huat-buys-majority-stake-in-french-foods-retailer

Business Times | 8 Jun 2021 | Lynette Tan

PHOON Huat plans to open three more stores in Singapore this year, taking the tally to 22 stores, from 19 currently.

It is also on the lookout for opportunities to acquire, said Shuichi Sato, chief executive of the home-grown baking supplies retailer, in an interview with The Business Times on the back of Phoon Huat’s acquisition of a majority stake in French goods retailer Le Petit Depot.

But Mr Sato added that Phoon Huat remains a “small and humble” company: “We do not jump into big, fancy deals.”

“Regarding Le Petit Depot, it is a humble and stable, yet ambitious, company with whom we share chemistry,” he said.

Phoon Huat also intends to remain a speciality retailer. “We specialise in baking products, just like how Le Petit Depot specialises in French products. We will not try to become a big supermarket,” Mr Sato said.

The company has plans to expand overseas as well. This year, Phoon Huat resumed talks with potential partners about expanding into South-east Asian countries. The discussions had been put on hold due to the Covid-19 pandemic.

However, discussions are taking more time than expected, due to travel restrictions and some of the potential partners being focused on navigating the Covid-19 situation, Mr Sato said.

Overall, Phoon Huat is on track to hit US$100 million in revenue for its current financial year ending June. It crossed S$100 million in revenue in 2017.

Corporate records show Phoon Huat Pte Ltd has S$87.1 million in paid-up capital.

The 74-year-old company has come a long way since its beginnings as a shop along Middle Road by Hainanese entrepreneur Wong Tai Fuang. Its website states that the founder made deliveries himself on his bicycle in the early days.

Phoon Huat started out as a wholesale supplier of baking ingredients, but has also grown into a retail chain over the years.

In 2002, it started retailing in supermarkets, invited by NTUC FairPrice, according to its website. That year, the company also set up its headquarters at Pandan Loop.

Phoon Huat’s success later caught the attention of Standard Chartered Private Equity, which took a “significant stake” in the company in 2016, reportedly for US$112 million to US$150 million. Then, Phoon Huat had about a dozen retail outlets in Singapore.

Wong Chen Liong, a descendant of the founder and the then-managing director of Phoon Huat, had welcomed the investment, saying it boded well for the firm’s succession planning which had been in the works for the last five years.

Standard Chartered’s private equity unit has since been wound up.

Members of the Wong family that are involved in the business include James Wong, the founder’s grandson and an executive director at Phoon Huat, and Jean Wong, a business development director at the firm.

Mr Sato, who has worked at commodities firms Wilmar and Bunge, joined Phoon Huat in 2018 as chief executive.

Link to Article (for BT subscribers): https://www.businesstimes.com.sg/sme/phoon-huat-to-open-more-stores-this-year-on-the-lookout-for-deals

Business Times | 8 Jun 2021 | Lynette Tan

BAKING suppliers retailer Phoon Huat has acquired a majority stake in Le Petit Depot, a Singapore-based online retailer that specialises in French food products.

Phoon Huat now holds 91.5 per cent interest in Le Petit Deport, according to corporate records The remaining shares are help by Le Petit Depot’s founders, Frenchmen Yannick Guédon and Frédéric Douvillé and a holding firm, Oper8. Phoon Huat declined to comment on details of the deal.

Let Petit Depot has paid-up capital totalling S$3.5 million, the records show. The company was started in 2021 and now retails more than 8,000 products, from meats to wine.

In a join statement on Monday, both businesses said the deal will allow them to “leverage each other’s strengths to grow their online businesses and extend the product range in retail stores under Phoon Huat”. This is as Phoon Huat and Le Petit Depot aim to double their sales volumes in three years.

Both companies will also work on reducing supply chain costs and optimising IT infrastructure. “To achieve efficiency is critical especially in the current environment where al costs are on an increasing trend,” they said.

Added Phoon Huat chief executive Shuichi Sato: “With the outstanding e-commerce and technology of Le Petit Depot and Phoon Huat’s strong foundation as a leading food products supplier, we will be in a unique position to capture strong growth in the market and better our service to our customers in the F&B (food and beverage) industry and baking enthusiasts.”

Phoon Huat hit S$100 million in revenue last year, popped up by a home-baking frenzy amid the Covid-19 pandemic.

But the company had little idea how the year would turn out, as the pandemic situation was fluid, Mr Sato told The Business Times in February.

“It was difficult to have any expectation or prediction (during this period). We worked to handle the changing needs of our customers that were affected by the evolving Covid-19 situation,” he had said.

Phoon Huat currently has 19 retail stores in Singapore and an online shopping site.

Link to article: https://www.phoonhuat.com/wp-content/uploads/2021/06/BT-8-Jun-2021.jpg