Tuesday, November 02, 2010

And The KFC Chicken Is Related!!

Sorry but I simply could not resist that title for this posting!

On the Edge: KFC buys another asset from JCorp

  • KFC buys another asset from JCorp
    Written by Financial Daily
    Tuesday, 02 November 2010 12:20

    KUALA LUMPUR: KFC Holdings Bhd (KFC), via its wholly owned Ayamas Food Corp Sdn Bhd, has proposed to acquire four poultry broiler farms from companies under Johor Corp (JCorp) for RM1.11 million.

    This is the latest in the series of related party transactions (RPTs) between JCorp and KFC, with the value of the transactions in the last 12 months totalling RM30.8 million.

    In an announcement to Bursa Malaysia yesterday, KFC said that Ayamas proposed to acquire Southern Poultry Farming Sdn Bhd, Synergy Poultry Farming Sdn Bhd, Ventures Poultry Farm Sdn Bhd and Agrotech Farm Solutions Sdn Bhd from Johor Ventures Sdn Bhd and Johor Franchise Sdn Bhd — two wholly owned subsidiaries of JCorp.

    JCorp is the major shareholder of plantation group Kulim Bhd. The plantation group is the holding company of QSR Brands Bhd which, in turn, is a major shareholder of KFC.

    According to the announcement, Ayamas had built eight broiler farms on 400 acres of land in Kulai, Johor. An “intrapreneur scheme” was established where intrapeneurs are encouraged to participate and own the broiler houses in the farm. In total, the eight farms have a total of 16 broiler houses with a total capacity of 800,000 broilers per cycle.

    Ayamas currently manages over 90 contract farmers and two company-owned broiler farms in Negeri Sembilan and Johor, where seven farm intrapreneurs participate in managing the broiler houses.

    Four out of the seven intrapreneur farms are owned by JCorp’s Johor Franchise and Joor Ventures and the remaining three are owned by Ayamas. Ayamas has proposed to centralise and implement a corporate structure where all the farms will be managed by one company so as to enable it to reap the advantages of a single structure in managing cost.

    All the four farms started operations only last year and are still loss making. According to the announcement, the acquisition will not have any material effect on the earnings of KFC for the current year of operations.

    “Nevertheless, the acquisition is expected to contribute to the future earnings of KFC,” it stated.

    The RPTs between JCorp and money-spinner KFC have always drawn scrutiny. According to the announcement, in the past 12 months, the RPTs amounted to RM30.8 million with the biggest item being the purchase of KPJ Reit Bhd shares by KFC that amounted to RM20.87 million.

    This article appeared in The Edge Financial Daily, November 2, 2010

Ahem... the RPTs involved....!!!!!!!

Why so like this one?


Gamelion said...

LOL!!!!This is a very typical example why the small fellow always getting screw all the time.