The turnaround of A&W Malaysia by George Ang & his team

Soooo the last few days, we’ve discussed the Valuation Adjustment Mechanism (VAM) in depth. It’s been a good ride with you all.

We’ve seen win-win scenarios ( ie.Kaw Kaw Malaya) and absolute disasters (ie. Oasis Harvest).

Today, we conclude with a masterclass in M&A execution and capital structuring: The A&W Malaysia Turnaround.

𝗖𝗵𝗮𝗽𝘁𝗲𝗿 𝟭: 𝗔&𝗪 𝗠𝗮𝗹𝗮𝘆𝘀𝗶𝗮, 𝗧𝗵𝗲 𝗦𝗹𝗲𝗲𝗽𝗶𝗻𝗴 𝗧𝗶𝘁𝗮𝗻

Years ago, A&W Malaysia was a forgotten brand—you couldn’t even use a credit card at their outlets. It was damn sad.

But George Ang, founder of Intermark Resources (the operator behind Manhattan Fish Market and Tony Roma’s), didn’t see a dying brand. He saw a sleeping dragon.

So in 2018, he acquired A&W Malaysia from KUB for RM 34mil

But now he’s facing another challenge, he just spent a fortune to purchase the brand and he’s in need of more funds…. So to fund aggressive expansion, he made a high-stakes move: 𝗛𝗲 𝘀𝗼𝗹𝗱 𝗮 𝟱𝟭% 𝘀𝘁𝗮𝗸𝗲 𝘁𝗼 𝗽𝘂𝗯𝗹𝗶𝗰-𝗹𝗶𝘀𝘁𝗲𝗱 𝗣𝗮𝗻 𝗠𝗮𝗹𝗮𝘆𝘀𝗶𝗮 𝗖𝗼𝗿𝗽 (𝗣𝗠𝗖) 𝗳𝗼𝗿 𝗥𝗠 𝟮𝟭 𝗺𝗶𝗹𝗹𝗶𝗼𝗻.

But the capital came with a brutal condition:

George Ang had to guarantee a minimum EBITDA of RM 13.75 million for FY 2022. The contract was ruthless. If they missed the target by even RM 1, George Ang had to personally cover the shortfall in cold, hard cash.

If you ask me, he’s putting his entire personal networth on the table:

1. Fast food market is already dominated by players like McDonalds and KFC that time. Not to mention, Jollibee just entered Malaysia in 2018
2. A&W is severely behind their competitors.

𝗖𝗵𝗮𝗽𝘁𝗲𝗿 𝟮: 𝗧𝗵𝗲 𝗘𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻 & 𝗧𝗵𝗲 𝗨𝗹𝘁𝗶𝗺𝗮𝘁𝗲 𝗣𝗮𝘆𝗼𝗳𝗳

But admist all odds, when backed into a corner, his team executed flawlessly. They brought back the iconic frozen mugs, overhauled the supply chain, and expanded aggressively.

They performed so well that in early 2024, PMC exercised their option to acquire the remaining 49% stake from George Ang for a massive RM 69.45 million.

𝗟𝗲𝘁’𝘀 𝗱𝗼 𝘁𝗵𝗲 𝗺𝗮𝘁𝗵 𝗼𝗻 𝘁𝗵𝗶𝘀 𝗠𝗮𝘀𝘁𝗲𝗿𝘀𝘁𝗿𝗼𝗸𝗲:

1. Valuation Explosion: In 2021, 51% was worth RM 21M (Company Valuation: ~RM 41M). Three years later, 49% was worth RM 69.45M (Company Valuation: ~RM 141M). He more than tripled the enterprise value.
2. The Boss Move (Share Swap): George Ang didn’t just cash out and retire. He executed a Share Swap, converting his payout into PMC shares.

Today, George Ang is not just the CEO of A&W; he is the 2nd largest shareholder and Executive Director of PMC. He evolved from an F&B operator into a Public Market Capital Boss.

What a journey right? There’s much to learn for us. Follow ZFounderclub and me for more stories like this.

Hustle on, founders.