>> ASIAONE / NEWS / THE BUSINESS TIMES / STORY
Arthur Tay plans to take Achieva to new markets
Jamie Lee
Mon, May 03, 2010
The Business Times

ARTHUR Tay, an ambassador of all things fine and fancy, has added a new role as CEO of Achieva, a listed electronics firm.

Mr Tay - better known as the owner of One°15 Marina Club at Sentosa Cove through his private company SUTL Global - expects to make use of his expertise in the distribution business to take Achieva to new markets, as well as to hunt for acquisitions.

And while Mr Tay is open to injecting businesses from SUTL Global into Achieva, he emphasised that both businesses will be treated separately.

'I would take it very isolated, at arm's length, and look at what is best for Achieva,' Mr Tay told BT in an interview. 'We'll keep it very open.'

Mr Tay took over as CEO last Friday, after buying a controlling stake in December 2009 from Achieva's former executive director Henry Lim, who had to step down for health reasons.

Mr Tay's then-purchased stake of 23.4 per cent - which he has since raised to about 25 per cent - cost him $15.2 million.

He was introduced to Achieva through the company's chairman Lew Syn Pau, and felt there were similarities between Achieva's business and that of SUTL, which counts its distribution of consumer goods such as tobacco and alcohol as its biggest sales contributor.

'The guiding principle of fast-moving consumer goods (FMCGs) is nothing new to me,' said Mr Tay.

One of his priorities will be to look into creating premium products that can command higher margins, since Achieva's distributed products are sold at 'very low margins' now, Mr Tay noted. This could mean acquiring businesses that would help the company to launch new products, he added.

'We're looking closely at the cash we have and we'll have to shop very wisely.'

Achieva posted a 87.4 per cent slump in fiscal 2009 net profit to $2.84 million on lower gross profit margin, which dropped to 6.7 per cent from 10.2 per cent a year ago. Its total cash hoard as at end-December 2008 stood at about $39 million.

Achieva currently focuses on distributing computer peripherals and software such as hard disk drives to markets including Malaysia and Singapore, after selling the group's electronics components distribution business in early 2008.

Mr Tay hopes to expand Achieva's reach beyond its existing six markets through SUTL's distribution channels. His private company is operating in 17 markets, including Bhutan and Mongolia.

Achieva counts companies such as Western Digital and Intel as its customers, and last year lost major supplier Seagate, whose business contributed about 30 per cent of group sales for the half-year ended June 30, 2009.

But the loss of Seagate may not be as bad as it seems, pointed out Mr Tay.

Unlike other FMCG businesses, electronic distributors such as Achieva have the culture of working with competitors that make similar products because of the product turnaround time.

'If you sell BMW, you can't sell Mercedes-Benz. But because the (electronic) products are so fast-moving, (suppliers) don't give to one distributor,' said Mr Tay. 'We lost Seagate for certain markets, but Western Digital is very happy because we take more Western Digital products.'

Bookmark and Share

 
 
STORY INDEX
 
  Asia is spam king but S'pore bucks trend
   
 
  Arthur Tay plans to take Achieva to new markets
   
 
  Developers differ in views over Thailand
   
 
  Maintain our lead, PM urges workers, bosses
   
 
  UOB seeking younger directors
   
 
  Saving capitalism from itself
   
 
  Banker's 'fresh start' runs onto rocky road
   
 
  Fed opts for gentle touch on interest rates
   
 
  Changi reports strong rise in Q1 traffic
   
 
  65% of finance execs looking for better jobs
   
We welcome contributions, comments and tips.
a1admin@sph.com.sg
Search AsiaOne: