Yeo Hiap Seng
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Yeo Hiap Seng Limited (YHS) is a manufacturer and distributor of food and beverages. Listed on the Singapore Exchange since 1969, it has grown from a family-owned and controlled business to one with an international reach, with products distributed in more than 55 countries. YHS has also diversified into property development, building a number of condominiums and landed properties. In the mid-1990s, control of YHS passed from the Yeo family to Ng Teng Fong’s Far East Organization.
History
In 1901, Yeo Keng Lian set up the Hiap Seng (later Yeo Hiap Seng) shop making and selling soya sauce in Zhangzhou in China’s Fujian Province. His eldest son, Yeo Thian In, took over the business before moving to Singapore in 1938 to escape the Sino-Japanese War. He established the Yeo Hiap Seng Sauce Factory located at the junction of Outram Road and Havelock Road, which opened for business on 18 September 1938. Yeo was joined by his third brother Thian Kiew in 1939, although YHS’s business was not brisk due to keen competition.
The factory sustained bomb damage after a series of Japanese air raids in January 1942, and because of the damage it had suffered, YHS was spared the fate of other soya sauce factories that were seized and occupied by the invading Japanese for use as ammunition depots. The factory was thus able to maintain production through the Japanese Occupation and thrived in the absence of a number of rivals.
In 1955, the business was incorporated as a private limited company and renamed Yeo Hiap Seng Canning and Sauce Factory Private Limited. More members of theYeo family had joined the business, and in August 1956 an agreement was signed to divide the ownership of the company among Yeo and four of his brothers – Thian Soo, Thian Kiew, Thian Seng and Tian Hwa, and two of Yeo Keng Lian’s grandsons. The five brothers held various management posts and YHS also invested in food laboratories, canning and bottling lines at their factory.
Expansion
YHS had gone into the production of canned food in 1952, producing chicken, mutton and beef curry, braised pork, pig’s trotters, pickles, canned seafood and canned vegetables. The company expanded its range of various sauces and by 1955 was producing around 224,000 bottles of sauce each month and nearly two million cans of food each year. Of this output, roughly a third was for the Singapore market while the rest was exported to the Federation of Malaya, Borneo and Indonesia.
YHS also brought out bottled soya bean milk and sales of the latter, as well as other traditional Asian drinks such as chrysanthemum tea, herbal tea, sugarcane and water chestnut, grew to account for around 70% of the factory’s profits in the 1950s. Canning factories were later set up in the Federation, to avoid paying import tariffs imposed there.
By 1957, YHS was producing 20,000 cans of food and drinks per day, and in the next decade the company’s export markets grew to include Australia, Brunei, the Philippines, Hong Kong, the United States and Europe. In the 1960s, YHS’s food products included canned shark’s fin soup, fish ball soup, bamboo shoots and instant noodles, with most of these products being exported. The company also became the first food manufacturer in the world to package soft drinks in Tetra Brik cartons.
The company went public in Singapore in March 1969, and changed its name to Yeo Hiap Seng Limited, with its authorised capital going from S$2 million to S$10 million. Yeo Hiap Seng Holdings had been set up to hold 49% of the newly-public company, and 1.6 million ordinary shares were offered to investors. In 1975, its subsidiary, Yeo Hiap Seng (Malaysia) was listed on the Kuala Lumpur Stock Exchange. In the 1980s, YHS further expanded its manufacturing and distribution networks overseas, including a joint YHS-Temasek Holdings acquisition of Chun King, an American food manufacturer in 1989. The US$52 million venture suffered large losses however, and became a catalyst for a significant turning point in YHS’s history.
Yeo family feud
In the early 1990s, a number of Yeo family members with stakes in YHS Holdings came into dispute with YHS chairman and chief executive Alan Yeo over his management style, the direction of the company and investment losses. Alan’s nephew Charles led a faction of the Yeo family that sought to oust Alan as chairman, and in May 1994 blocked Wing Tai Holdings’ bid to acquire up to 40% of the company. The bid had been supported by Alan Yeo, who hoped to utilise Wing Tai’s connections in China. After the failure of the Wing Tai deal, Yeo went to court to petition to dissolve the family holding company. The case lasted for ten days, with the court ruling in his favour. This resulted in the Yeo family’s collective 38.5% stake in the company being split up.
Ng Teng Fong, one of Singapore’s richest men, had been buying YHS shares on the open market and vied for control of YHS with Malaysian Quek Leng Chan. Ng won the takeover battle and acquired majority control in 1995, the same year Alan Yeo resigned as chairman. The last member of the Yeo to run the company, Yeo Chee Yan, retired in 1999.
Diversification and operations
YHS entered the property business in the mid-1990s and by 2010, revenue from its property division amounted to almost 13% of overall earnings. YHS’s first property project was the Tivoli Gardens condominium, and was followed by more private housing projects.
From the 1990s, YHS continued to expand its manufacturing and distribution networks outside Singapore and now has operations in China, Malaysia, the United Kingdom, the United States, Vietnam, Australia, Canada, Africa, South Asia and Hong Kong, with the Asian operations making up around 90% of the company’s turnover of around S$471 million in 2010. The company also continued to grow its product line alongside consumer trends.
Author
Yulia Hartono
References
Chan, K. B., & Ng, B. K. (2004). Singapore. In Gomez, E. T., & Hsiao, H. H. M. (Eds.), Chinese business in Southeast Asia: contesting cultural explanations, researching entrepreneurship (pp.38-61). New York: Routledge Curzon.
(Call no.: 338.88951059 CHI)
Chan, S. M. (1994, July 6). Major shareholders withdraw motion to kick out Alan Yeo. The Straits Times, p. 40. Retrieved November 9, 2011, from NewspaperSG.
Chan, S. M. & de Silva, G. (1994, May 21). The family feud that will change Yeo Hiap Seng forever. The Straits Times, p. 32. Retrieved November 9, 2011, from NewspaperSG.
Eng, C. (1999, August 16). Yeo Hiap Seng positions itself for the new millennium. The Business Times. Retrieved November 9, 2011, from Factiva.
Five brothers outgrow a factory. The Sunday Times, p. 3. Retrieved November 9, 2011, from NewspaperSG.
Hill, P. (1950, May 31). Sauce for the tables of Malaysia. The Singapore Free Press, p. 4. Retrieved November 9, 2011, from NewspaperSG.
Lee, T. J., & Liu, F. T. (2010). The soy sauce towkay. Singapore: Campus Crusade Asia.
(Call no.: RSING 338.766458092 LEE)
Quek, J. (1994, May 17). Alan Yeo tells employees why he backed Wing Tai. The Business Times. Retrieved November 9, 2011, from Factiva.
Striking growth of food factory over 20 years. (1960, June 3). The Singapore Free Press, p. 18. Retrieved November 9, 2011, from NewspaperSG.
Tan, B. B. (1994, June 18). Charles’ uncle. The Straits Times, Life!, p. 2. Retrieved November 9, 2011, from NewspaperSG.
Yeo family rejects Wing Tai takeover offer. (1994, May 5). Reuters. Retrieved November 9, 2011, from Factiva.
Yeo Hiap Seng Limited. (1969, March 24). The Straits Times, pp. 5-7. Retrieved November 11, 2011, from NewspaperSG.
Yeo Hiap Seng’s modern sauce and canning factory. (1955, October 29). The Singapore Free Press, p. 33. Retrieved November 11, 2011, from NewspaperSG.
The information in this article is valid as at 2011 and correct as far as we are able to ascertain from out sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.
Subject
Organisations>>Companies
Soy sauce industry--Singapore
Canned foods industry--Singapore
Food industry and trade--Singapore
Yeo Hiap Seng--History--Singapore
Business, finance and industry>>Industry>>Manufacturing industries>>Food, beverages and tobacco
Business, finance and industry>>Business organization>>Business enterprises