In a bold move, Singapore’s Sim Leisure Group Ltd (SLG), a renowned theme park operator, acquired Kidzania Singapore for a modest sum of S$110,000, or around RM380,000. The company emphasized that Khazanah Nasional Bhd, Malaysia’s state sovereign fund, had no involvement in the sale of the theme park.
According to Datuk Sim Choo Kheng, the founder and executive chairman of SLG, Kidzania Singapore was a failed asset that had permanently closed in mid-2020 and subsequently went into receivership under a Singapore liquidator. Amid the peak of the COVID-19 pandemic, towards the end of 2020, SLG made a strategic decision to bid for Kidzania Singapore’s non-movable assets and has been negotiating the lease for the facility for the last two years with Sentosa Development Corporation (SDC).
Sim explained that SLG’s decision to purchase the theme park was not without risk. It was a time when physical verification of the non-movable assets was impossible due to the lockdown. Moreover, the condition of the theme park assets and the cost of renovation were unknown at the time. Nevertheless, SLG persisted in its negotiations with the licensor, Kidzania Mexico, to secure a licence agreement.
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Taking over failed assets like Kidzania Singapore, particularly at such a nominal price, has drawn criticism from the public, which Sim addresses. He states that most people do not comprehend the reality that a failed theme park often ends up as mere scrap metal, citing the case of the Movie Animation Park Studio in Ipoh as an example. Contrary to assets like hotels and resorts, which can be repurposed for various commercial uses, failed theme parks have limited utility.
Sim also made a point about the inexperience and lack of expertise most investors in the Southeast Asia region have when it comes to operating a theme park. He criticized their ill-considered ventures, explaining that these businesses often cross-subsidize the attraction business, a practice he believes is unsustainable.
In contrast, Sim Leisure Group’s approach is different. “We live, eat and breathe theme parks; it’s all we do,” says Sim. He emphasizes that their businesses are designed to be profitable from the outset.
In his concluding remarks, Sim sends a word of caution to prospective investors. He highlights that investing in theme parks involves more than just buying equipment or engaging intellectual property owners or foreign experts. It demands a deep understanding of the industry and its challenges.
As per reports, the indoor children’s theme park is set to make a comeback in Singapore by the first quarter of 2024, following a three-year closure. These developments follow rumors of a significant investment by Khazanah and Boustead Holdings Bhd in Kidzania Singapore in 2016, subsequently sold to SLG for a nominal sum. However, these allegations have been denied by the Finance Ministry, which confirmed the asset still remains in the possession of Khazanah Nasional Bhd.
This news is based on Malay News.
