Singapore – What started out as plans on September 21 became official today, as NTUC Enterprise now has the green light to acquire Kopitiam.
NTUC Enterprise, who is also the largest shareholder of NTUC Social Enterprises, holds NTUC Foodfare which means that their portfolio includes the management of 14 food courts, 10 coffee shops, and 9 hawker centres. On the other hand, the one giving up the reins, Kopitiam, has 56 food courts, 21 coffee shops, and 3 hawker centres.
All of these food establishments under one umbrella sparks concerns amongst Singaporeans of a possible monopolisation, much the like recent Grab acquisition of Uber operations. However, the Competition and Consumer Commission of Singapore (CCCS) has assured the public that a study was made on the three markets, food courts, coffee shops, and hawker centres, and said that there will be no effect leading to the decrease in competition because of this merger.
The study conducted by CCCS showed that there will be minimal amounts of cooked food being sold within a 500m area that is operating and owned by NTUC Enterprises and Kopitiam, meaning a lot of the stalls in a given space are still operated by third party vendors. Furthermore, CCCS found no cause for concern when it comes to management specifics of hawker centres, such as rental rates and bargaining power, because both parties only own 12 hawker centres out of the 114 currently operating in the country.
As for the rentals rates on coffee shops and food courts, it was assessed that the market share of the two will only be around 30-40% and that a majority will still be held by others such as Koufu, Food Republic, Food Junction, Broadway and Kimly, therefore, no drastic changes are expected to occur. These findings were reiterated by CCCS to ensure no monopolisation were to happen and that competition will remain strong because of this union.
As for how much was paid to Kopitiam Investments for the purchase, the sum remains undisclosed. It is said that the transaction will be final and completed during the first month of the following year.
Both parties will continue to operate as separate entities with their current management remaining intact and business will proceed as normal.
The people’s responses to such news, however, are not pleased. The public seems disillusioned and unsatisfied with the flow of the current events. Some of the responses have been captured below: