Ministry Of Food To Close Down After Failing To Pay S$200K Debt
Singapore’s restaurant chain, Ministry of Food (MOF), is reportedly shutting down after failing to pay off its S $ 200,000 debt, incurred from an interest-free loan made in 2019.
The creditor is Chua Ngak Hwee – the co-founder of medical device company Healthstats – who sued the MOF last month when the company failed to reimburse him.
Chua had requested the liquidation of MOF, which was granted by the High Court on April 9.
MOF has a large number of F&B brands in its group, including Daessiksin Korean BBQ Buffet, Danro Collagen Hotpot Buffet, Insadong Korea Town, Ju Hao, Lenas, MOF My Izakaya, Social Square, Ssiksin Korean Grill BBQ Buffet Restaurant and Terminal Mr.
The Group was created in Singapore in 2006, but all the restaurants that are part of it have since closed their doors.
However, The Straits Times reported that Daessiksin Korean BBQ Buffet at Orchard Gateway is still operational as it is run by Master Kitchen Concepts, a separate business entity.
According to Acra (Accounting and Corporate Regulatory Authority) records, Master Kitchen Concepts was incorporated in December of last year. It is owned by Dr Ting Choon Meng, a director of the Ministry of Food who served from 2016 to 2018. He is also the co-founder of Healthstats.
In February last year, the MOF saw massive store closures in Singapore, reducing its size from 80 to 26 outlets.
In particular, two of its points of sale – Ju Hao in Bukit Panjang Plaza and MOF My Izakaya in Lot 1 – were taken over by the owner CapitaLand for non-payment of rent.
Founder facing financial difficulties
Last year, The Sunday Times reported that Sim was struggling to pay not only the rental, but also vendors and employees.
Her financial troubles date back to a failed trade deal in 2017, in which she intended to buy a chain of Korean restaurants and sell them back to a Thai conglomerate that was in talks to acquire MOF.
Sim reportedly agreed to buy the Korean restaurant chain for S $ 5.5 million, but only paid S $ 700,000 after the deal broke down.
As a result, four shareholders of the Korean channel – Lee Je-young, Soh Sow Hoon, Huh Suk Kyung and Lee Pil Young – sued Sim for the exceptional sum of S $ 4.8 million.
In February 2020, they obtained a Mareva injunction against Sim, which refers to a court order that freezes the defendant’s assets to prevent him from dissipating the assets.
His assets were frozen to a value of S $ 4.8 million.
Sim also told The Sunday Times that she executed a “major overhaul” of MOF after the acquisition failed.
Under pressure from the “workforce tightening”, it closed all table service concepts that were “no longer viable in Singapore’s food and beverage landscape”, removing around 40 points sales in 2019 alone.
According to Sim, these downsizing measures helped the company become operationally profitable in the fourth quarter of 2019.
However, the Covid-19 epidemic has made a dent in the restaurant industry and the MOF has seen a 35% drop in performance in the group. While some outlets could still get by, eight of them suffered a sharp drop in sales of 80 to 90 percent.
In addition to the effects of the pandemic, banks are said to have frozen Sim’s accounts, including his personal accounts, after Mareva’s injunction. Sim said it kept her from paying homeowners and suppliers.
She was also questioned by the Ministry of Manpower (MOM) and had her passport confiscated for not paying the salaries of the employees.
Featured Image Credit: Ministry of Food
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