Though you may not know the name of retail behemoth Dairy Farm International Holdings (SGX: D01) you will undoubtedly know its Singaporean brands – Cold Storage, Giant, Guardian, Jason’s Marketplace and 7-Eleven, to name but a few. Dairy Farm also operates supermarkets and health & beauty stores throughout the rest of Asia such as Wellcome, Mannings and Health and Glow and Ikea in Hong Kong and Taiwan. It also has a 50% stake in Maxim’s – Hong Kong’s leading restaurant chain. Whilst it’s now part of the sprawling conglomerate that is Jardine Matheson (SGX: J36) Dairy Farm had…
Though you may not know the name of retail behemoth Dairy Farm International Holdings (SGX: D01) you will undoubtedly know its Singaporean brands – Cold Storage, Giant, Guardian, Jason’s Marketplace and 7-Eleven, to name but a few.
Dairy Farm also operates supermarkets and health & beauty stores throughout the rest of Asia such as Wellcome, Mannings and Health and Glow and Ikea in Hong Kong and Taiwan. It also has a 50% stake in Maxim’s – Hong Kong’s leading restaurant chain.
Cows from Scotland
Dairy Farm, founded in 1886, was the brainchild of a Scottish surgeon, Dr Patrick Manson and five well-known Hong Kong businessmen. They wanted to improve the health of Hong Kong’s people by providing them with their own, clean, non-contaminated cows’ milk – with the crazy plan to import the required dairy cattle all the way from Manson’s native Scotland. This would theoretically allow them to halve the price of milk, and realise a profit for their shareholders.
Unsurprisingly it wasn’t easy. The cows that survived the arduous journey had to contend with an unfamiliar climate as well as disease in the herd.
A’ milking we will go…
But with the help of their staff of British livestock experts, succeed they did and by 1892, the Pokfulam farm had become a thriving enterprise. With over 15,000 Europeans in Hong Kong, demand became such that the company built a cold storage warehouse known as the Old Dairy Farm Depot to allow them to store their milk.
Dairy Farm was soon importing butter and frozen meat from Australia, opened its first retail store in 1904 and by the First World War was supplying Hong Kong’s fishing boats with ice. By 1928, the company had six retail stores, and through its subsidiaries was supplying Macau and even some Chinese cities.
By 1946, post-war Hong Kong saw its people starting to enjoy normal essentials again. Dairy Farm’s future looked bright and it managed to make a record net profit of HK$1,519,292. The company acquired the grocery chain Wellcome in 1964, and expanded its retailing business.
In 1972, Dairy Farm was acquired by Jardine subsidiary, the Singapore-listed Hongkong Land (SGX: H78) in a deal that allowed it to retain its independence and personality – and continued to expand its retail operations. However, it was re-listed on the Hong Kong Stock Exchange in 1986, after being demerged from Hongkong Land.
But did you know…
- Dairy Farm’s Old Dairy Farm Depot, in Central, Hong Kong, is today a listed building, and currently houses the Foreign Correspondents Club.
- Dairy Farm marked its 120th anniversary by sponsoring the conversion of the last two remaining Dairy Farm cowsheds in Pokfulam into a performance venue for the Hong Kong Academy for the Performing Arts – The Wellcome Theatre.
- Dairy Farm was the first company to form a joint venture with the Chinese Government for the operation of a flight kitchen at Beijing International Airport.
- Dr Patrick Manson was not just a pioneer of Scottish milk in Hong Kong. His undoubted greatest achievement was scientific – he was the first person to realise that mosquitoes spread disease. It was by following his, and French physician Charles Laveran’s research that another doctor, Ronald Ross was able to demonstrate the life cycle of the malaria parasites in mosquitoes – one of the most important medical breakthroughs of all time, which earned Ross the Nobel Prize for Medicine in 1902.
- Patrick Manson was instrumental in the founding of the London School of Hygiene and Tropical Medicine, as well as the Hong Kong College of Medicine for Chinese (now, the University of Hong Kong). One of his first pupils there was Sun Yat Sen, the first President of the Republic of China.
Today, Dairy Farm has changed from a humble milk producer into one of Singapore’s largest listed companies. A leading pan-Asian retailer with over 5,700 outlets and 97,000 employees, it is also, interestingly, one of the world’s largest listed grocers in terms of market capitalisation.
Dairy Farm is 78% owned by Jardine Matheson with retail outlets throughout Singapore, Hong Kong, Macau, Malaysia, Vietnam, China, Brunei, Indonesia, Taiwan and India.
Looking forward, Dairy Farm has recently entered the Cambodian market by the acquisition of a 70% interest in the company that operates Lucky supermarkets, and the Philippines through a 50% stake in Rustan’s Supercenters, which operates Shopwise supermarkets and hypermarkets.
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The Motley Fool’s purpose is to help the world invest, better. The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Alison Hunt doesn’t own shares in any companies mentioned.