KUALA LUMPUR (Dec 12): Thong Guan Industries Bhd said its subsidiary 888 Cafe Sdn Bhd — which has welcomed two new investors — is seeing a reorganisation of equity structure, following a RM3.4 million capital injection aimed at expanding the food, beverages and other consumable products business.

In a filing with the stock exchange this evening, TGIB said the reorganisation entailed the increase in issued share capital of 888 Cafe from RM100,000 to RM3.5 million, by the allotment of new 3.4 million ordinary shares at an issue price of RM1 each to the new investors, Low Kang Moon and Yap Wai Fong, as well as Thong Guan and the latter's executive director Ang See Ming.

Ang, who had a 30% in 888 Cafe, now has 10%, while Low owns 6% and Yap has 4%. Both have extensive experience and broad-based knowledge of the food and beverages industry, TGIB said.

“The reorganisation is consistent with Thong Guan's strategic plan to expand the reach of its food, beverages and other consumable products division,” read the filing.

“It is envisaged that the inclusion of the investors as new equity partners in 888 Café would be beneficial as their combined experience, know how and knowledge could help to drive the business growth of 888 Café and thus, contribute to accelerate the group’s expansion in the food and beverages industry," TGIB added.

Thong Guan, who is upping its stake in 888 Cafe from 70% via an allotment of 2.73 million ordinary shares, will be financing its RM2.73 million subscription with internal funds.

TGIB expects 888 Cafe — which is principally engaged in restaurant operations — to contribute positively to the future earnings of the group, after the reorganisation.

Shares in TGIB rose 11 sen or 2.59% to close at RM4.36 today, giving it a market capitalisation of RM583.31 million.