Sakae pursues advisory business with sushi growth in mind

Singapore

SAKAE Holdings' Douglas Foo is hoping that a visit to the dentist will help him satisfy his craving for more sushi.

Sakae, which runs the Sakae Sushi chain of restaurants, announced on Tuesday that Q&M Dental is the first client for the newly set up Sakae Corporate Advisory. The appointment will last for two years. Sakae's task will include marketing Q&M to European and US investors.

That a restaurant business is moving into advisory work is unusual, to say the least, but Mr Foo said it is part of his grand plan to grow Sakae's chain of about 200 restaurants as at end-2013 to 30,000 outlets worldwide.

The advisory business, besides helping other companies to access capital, will come in handy when Sakae has to tap the market, although the company does not have immediate fund-raising plans, Mr Foo said.

"Finance is a very crucial part of the business," he said.

Mr Foo, who stepped down as chief executive of the listed company a year ago but remained its executive chairman, heads the new advisory business. The plan is to employ at least five finance industry veterans, and about S$10.5 million was set aside from internal resources to set up the new arm. The advisory business is fully owned by Sakae Holdings. Shareholders approved the diversification in 2014.

The plan is to tap Mr Foo's network of contacts in the United States and in Europe, many of them formed when Mr Foo was a fellow under the Eisenhower Fellowships leadership development programme. "We will help the companies to relook their business model, enhance productivity and efficiency and showcase these to potential investors," he said.

Mr Foo is no stranger to finance. He said he graduated with a degree in finance and business administration in the mid-1990s. He tried but failed to get a job in the bank back then, but he will finally get a second chance - by creating the firm.

Mr Foo draws inspiration from the likes of General Electric, which also has its own finance arm. Of course, General Electric is a much bigger company, but Mr Foo is not intimidated.

"Everyone has to start somewhere," he said.

Q&M chief financial officer Vitters Sim said Mr Foo approached the company to offer his services. Q&M is still sitting on proceeds from its last rights issue, and so has no immediate need for capital, Mr Sim said.

But the dental company was looking a few years into the future, and wants to raise its profile among investors, Mr Sim said. "It's more of a two-year kind of planning and strategic decision," he said.

Q&M decided to go with Sakae because Mr Foo was personally involved, and because it had a chance to be Sakae's first advisory client.

"We think we should get more attention from a new player than an existing one," Mr Sim said.

Market reaction was muted. Sakae shares slipped 0.9 per cent, or half a cent, to close at 56 Singapore cents following the Q&M appointment. Q&M shares closed flat at 48 Singapore cents.