[Editors’s Note: A previous version of the article included a valuation of Zouk. This is inaccurate as the value at which Zouk was sold to GHK was undisclosed. Article has been amended to reflect this.]
Mention “Jiak Kim Street” and Singaporean millennials are likely to conjure up memories of their time clubbing at Zouk’s old establishment there.
Since its founding in 1991, Zouk has consistently been ranked among the top clubs in the world.
However, due to the Covid-19 pandemic, club operators like Zouk Group have been unable to carry out operations for close to half a year now.
Even though the 29-year-old entertainment giant has been quick to pivot and turn its dance floors into a dining venue, business is still ailing.
Sold To A Malaysian Firm For S$14M
In a recent turn of events, Zouk Group has been sold to Malaysian firm Tulipa for S$14 million.
Back in 2015, Zouk was sold to Genting Hong Kong (GHK) for an undisclosed valuation.
The 2015 acquisition saw GHK buying all of Zouk’s major trademarks, including its Clarke Quay club and the yearly ZoukOut dance music festival.
GHK is the company behind the popular cruise brands Star, Dream and Crystal Cruises. It is headquartered and listed in Hong Kong, with a secondary listing in Singapore.
GHK is reported to have made a total net loss of S$1.01 billion for the first half of 2020. The company also owes creditors S$4.63 billion as of July 31.
This is in part due to the Covid-19 pandemic severely affecting the revenue of Genting’s cruise ship business.
The sale of Zouk Group to Tulipa at S$14 million is part of cash-strapped GHK’s strategy to generate liquidity.
However, Zouk Group too has been in the red. It was making a loss of close to S$13.97 million before tax since 2015.
Tulipa: Owned By Son Of Malaysian Tycoon
Tulipa is owned by Lim Keong Hui, the son of Malaysian tycoon Lim Kok Thay. The latter is a controlling shareholder of GHK.
Last month, Bloomberg reported that Lim Kok Thay had pledged nearly his entire stake in GHK as collateral for loans.
According to Forbes, Lim Kok Thay is Malaysia’s seventh richest, with a net worth of S$3 billion as of September 1.
He is the chairman of Genting Group, a casinos, resorts and palm oil conglomerate. Genting Group is also the operator behind Singapore’s first integrated resort — Resorts World Sentosa.
On the other hand, 35-year-old Lim Keong Hui had just recently stepped down as from his role as Deputy CEO of GHK, and looks set to take over Zouk Group off the company’s hands.
Tulipa Group is wholly-owned by Lim Keong Hui, who is the single largest shareholder with a 76% equity stake.
What’s Next For Zouk Group?
Besides nightclub Zouk, Zouk Group’s other assets include Five Guys burger joint at Plaza Singapura.
It is unclear if Five Guys will be affected by the acquisition.
In the case of Zouk, its operations in Singapore are likely to remain status quo. However, the future of nightlife in Singapore looks bleak.
As of August this year, at least a hundred nightlife businesses remain shut. Karaoke establishment Teo Heng for one, has made the move to shutter half of its 14 outlets in July.
Deputy Prime Minister Heng Swee Keat’s noted in his ministerial statement in August that nightlife establishments will not be able to reopen anytime soon.
Even though the Jobs Support Scheme has helped to tide clubs over, rental rebates have since ended.
For the immediate future, it seems like Singapore’s nightlife establishments have to either reinvent or die out.
Featured Image Credit: Zouk Group