Due to a restructuring exercise within BreadTalk Group, on 30 Dec-16, BreadTalk Pte Ltd (BTPL) had transferred its 70% equity interest in Taster Food Pte Ltd (TFPL) to another subsidiary of the Company, Together Inc Pte Ltd. Taster Food Pte Ltd's principal activities include operators of food and drinks outlets, eating houses and restaurants.

The consideration for the restructuring exercise is S$1.61m and was arrived at the cost of investment of BTPL in TFPL. This exercise is said to streamline the group's operations for better administrative efficiency and to reduce overall operating costs.

We keep in mind that the group has been focusing on operational costs initiatives amid cautious expansion plans in recent years, while inevitably, restructuring-related costs would have to be incurred from time to time. We currently have a HOLD on the stock with a fair value estimate of S$1.07.

Source: OCBC Research - 3 Jan 2017