SINGAPORE (Dec 10): Katrina Group, the F&B group, is acquiring the entire issued share capital of Straits Organization, a provider of affordable and diverse accommodations for a consideration of $358,000.
Founded in Dec 2017, Straits Organization provides accommodation solutions targeted at millennial travellers, corporate expatriates, medical tourism and new market segments such as technopreneurs. It currently manages approximately 125 units in 15 different apartments and condominiums across Singapore.
It has received acceptance from two landlords to convert the space into co-living hotels – one in Tanjong Pagar and another along South Bridge Road. Straits Organization is also currently negotiating two more potential locations in Singapore and Hong Kong.
Straits Organization has an issued and paid-up share capital of $280,000, which was previously owned entirely by Alan Goh, founder, CEO and chairman on Katrina Group.
From Dec 15, 2017 to Oct 31, 2018, Straits Organization recorded profits after tax of $64,273. The acquisition provides access into burgeoning hospitality segments as well as contributes additional and recurring revenue in the form of rental, service and/or management fees.
Katrina Group funded this acquisition through internal resources, satisfied by cash by the group.
“This acquisition reinforces our strategy of diversifying the Group’s revenue stream across businesses, markets and segments to mitigate against weaknesses from any one sector. Straits Organization not only opens the door to the hospitality segment for the group but also offers the possibility of cross-sector collaboration for our core F&B business and further regional expansion. It is an earnings accretive acquisition which we believe bolsters the group’s growth potential and provides a stable base of recurring income,” says Goh.
Shares in Katrina Group closed at 21 cents on Monday.