Competition watchdog calls for public feedback on NTUC Enterprise’s proposed takover of Kopitiam
NTUC Foodfare runs 14 food courts, 10 coffee shops and nine hawker centres.
SINGAPORE — With the competition watchdog gathering feedback on the proposed acquisition, NTUC Enterprise has submitted that its takeover of home-grown food centre operator Kopitiam would not be anti-competitive, given the large number of foodcourt operators and street stall vendors in Singapore.
Among other things, it also pointed out that “barriers to entry and expansion” are low since obtaining the necessary operating licences is “not unduly onerous and upfront capital expenditure will become lower over time”, as the food services industry adopts technology and innovative practices.
These arguments were among the submissions made by NTUC Enterprise — the largest shareholder of the labour movement’s social enterprises — to the Competition and Consumer Commission of Singapore (CCCS).
The CCCS announced on Friday (Sept 28) that it will be conducting a public consultation from Oct 1 to 12 to gather feedback on the proposed acquisition.
The announcement came a week after NTUC Enterprise and Kopitiam announced the transaction — which is subject to regulatory approval and other conditions — for an undisclosed sum.
Following the proposed takeover which is slated for completion by the end of the year, NTUC Foodfare — which is overseen by NTUC Enterprise and has 33 food centres — and Kopitiam will continue to operate separately, with “their respective management teams and employees remaining in place”.
Kopitiam, which was founded in 1988, operates 56 food courts, 21 coffee shops, three hawker centres and two central kitchens, dishing out about 350,000 meals daily. It manages more than 1,000 food stalls and employs over 1,000 people.
NTUC Foodfare runs 14 food courts, 10 coffee shops and nine hawker centres.
The deal could make NTUC Enterprise the largest operator of food centres here. When asked by TODAY last week how it would seek to prevent anti-competitive practices from creeping in after the deal goes through, NTUC Enterprise did not respond directly, saying it was in the process of “seeking the necessary approvals”.
CCCS said on Friday it has received a notification from NTUC Enterprise for a decision on the proposed deal, and it is now assessing whether it would infringe the Competition Act, which prohibits “mergers that have resulted, or may be expected to result, in a substantial lessening of competition within any market in Singapore”.
It added that NTUC Enterprise has also submitted that “new entrants or existing competitors will find it easy to enter or expand into the relevant markets quickly”, since more sites are likely to be made available for street stall operations as part of the Urban Redevelopment Authority’s development plans in commercial precincts and housing estates.
According to NTUC Enterprise, the proposed acquisition would “enhance its ability to optimise its mix of food offerings across its outlets”. It also said that it can “re-channel the cost savings to invest in research and development, new technologies and innovative in-store practices which will in turn improve the value to food vendors and deliver a better dining experience for end consumers”.
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