Signature International to acquire Corten Interior, Areal Interior for S$47.8mil

Chiau Haw Choon

PETALING JAYA: Kitchen cabinet manufacturer Signature International Bhd (SIB) is proposing to acquire Singapore’s Corten Interior Solutions Pte Ltd and Areal Interior Solutions Pte Ltd (Areal) for S$47.8mil (RM160.48mil).

In a filing with Bursa Malaysia yesterday, SIB said it had entered into a conditional share sale agreement (SSA) with Lim Leng Foo to acquire 1.5 million ordinary shares or 75% equity interest in Corten for S$45mil (RM151.08mil).

The company also entered into a SSA with Lim and Chua Wei Ping to acquire one million ordinary shares or 100% equity interest in Areal, for S$2.8mil (RM9.4mil).

The acquisitions will be funded via a combination of internally generated funds and bank borrowings and is expected to be completed by the first half of 2023.

In a statement, SIB managing director Chiau Haw Choon said the proposed acquisitions are in line with the group’s objective of acquiring strategic stakes in profitable companies within the industry to secure strong and sustainable growth domestically and internationally.

“Corten, Singapore’s largest kitchen and wardrobe company with more than 50% market share of private residential property projects, is a perfect fit with Signature’s kitchen cabinet and whole house customisation business,” he said.

Corten’s clients include some of the best-known names in property development in the island state and Malaysia including Allgreen Properties Ltd, City Development Ltd, Capitaland Ltd, Fraser Property Ltd, Keppel Land Limited, MCL Land Limited, SC Global Developments Pte Ltd, Singhaiyi Group, Four Seasons Kuala Lumpur and SDB Properties Sdn Bhd.

Chiau said he is upbeat about the group’s prospects.

He added that the consolidation of Corten and Ariel’s equity interests will increase SIB’s profitability and strengthen the group’s financial position.

“There’s clear profit visibility as there’s not less than S$200mil (RM671.48mil) in Corten’s order book as of end October 2022. This order book will keep the company busy for the next three years, 2023-2026.

“In addition, Corten guarantees a profit after tax of not less than S$10mil (RM33.57mil) for the financial year ending 28 February 2023.”

The global kitchen cabinets market is estimated to be valued over US$160bil (RM759bil) in 2025 and is projected to register a compounded annual growth rate (CAGR) of 6% from 2021 to 2026.

Meanwhile, the global furniture market generated US$637.26bil (RM3.02 trillion) in 2021 and is estimated to reach US$945.5bil (RM4.49 trillion) by 2030, manifesting a CAGR of 4.5% from 2022 to 2030.