KUALA LUMPUR (July 15): Oldtown Bhd is expanding its "Oldtown White Coffee" restaurant empire footprint into Jiangsu province in China, with the first outlet to be opened in Wuxi City in October this year.

It told the local bourse today that it has conferred the right to operate and sub-license the territorial rights to operate "Oldtown White Coffee" in Jiangsu province, China, to G&L Food and Beverage Management Co Ltd.

The "Oldtown White Coffee" restaurant operator entered into the deal via its indirect unit, Shenzhen Kopitiam Asia Pacific Ltd (Shenzhen Kopitiam).

Oldtown Asia Pacific Ltd, the master licensee of the restaurant chain, has on May 1 this year awarded and executed territorial licence with Shenzhen Kopitiam, for a five years term expiring April 30, 2021.

The license shall be automatically renewed for two successive five year terms unless Shenzhen Kopitiam elects not to renew the agreement, according to "Oldtown White Coffee" restaurant chain operator.

G&L Food and Beverage is a China-based company that incorporated solely for the purpose of securing the territorial license rights over the Jiangsu province to own, operate, and sub-license the right to operate Oldtown White Coffee restaurants within the province.

It scheduled to open its first China outlet in the Wuxi City in October 2016.

According to Oldtown, its group managing director and executive director Lee Siew Heng is deemed interested in the territorial licence, as he is also a director and major shareholder of Oldtown Asia Pacific.

The remaining director and shareholder of Oldtown Asia Pacific is Chan Koon Hung.

The group does not expect the territorial license to have any material effect on its earnings for the financial year ending March 31, 2017 (FY17).

Shares in Oldtown was traded almost at its two years high of RM2.01, gaining two sen or 1.01%, giving it a market value of RM911.97 million.