APAC Realty, which holds exclusive ERA regional master franchise rights in 17 Asia Pacific countries, said on Monday it entered partnerships in Indonesia and Thailand to expand its presence.
In Indonesia, the realty company tied up with ERA Indonesia CEO Darmadi Darmawangsa and the management team to fund the purchase of the ERA master franchise operations there from its current shareholders, it said in a filing to SGX before the market open on Monday.
In addition, APAC Realty entered a deal with Voradet Sivatachanon, CEO and managing director of Thailand’s master franchise operations, to cooperate on developing the real estate brokerage and franchise in Thailand, the filing said.
“ERA Indonesia and ERA Thailand are two of our longest running franchises in Asia,” Jack Chua, CEO of APAC Realty, said in a statement. “The latest developments in Indonesia and Thailand are a continuation of steady inroads that APAC Realty has made in deepening our regional business presence.”
Chua added that Indonesia, in particular, offered long-term opportunities based on its population of more than 265 million and its growing economy.
In Indonesia, APAC Realty’s wholly owned subsidiary APAC Investment 2 will lend up to S$13.85 million to PT Realti Jaya Abadi to acquire PT ERA Graharealty, or ERA Indonesia, which is the ERA master franchisor for Indonesia.
The consideration for the deal comprises a convertible loan of S$4.42 million and a conditional share purchase loan of S$9.43 million, and includes acquiring office space in Central Jakarta, it said.
“We see significant near to mid-term upside for ERA Indonesia as we create new revenue streams such as implementing ERA Singapore’s proven project sales business model in the country. This will generate stronger margins,” Chua said.
In Thailand, the cooperation deal calls for creating two new companies, APAC Holding (Thailand), or APAC Thailand, and ERA Holding (Thailand), or ERA Thailand, to hold the ERA master franchise rights for Thailand, it said.
APAC Realty will provide a shareholder loan of US$1 million, or around S$1.38 million, to the two new companies, collectively called ERA Thailand, it said.
ERA Thailand will be around 73.99 percent held by APAC Realty, making it a subsidiary, and APAC Thailand will be 49 percent held by APAC Realty, making it an associated company, with the remainder held by Sivatachanon, it said.
“The direct ownership of the Thailand franchise will enable APAC Realty to be more strategically involved in developing ERA’s business in Thailand,” APAC Realty said in the statement. “Additionally, APAC Realty’s subsidiary ERA Singapore and ERA Thailand can also tap into cross-selling benefits, as the operational structure will allow their sales agents to work together to market and sell overseas properties to their respective customers.”