Jollibee completes Coffee Bean purchase
Credit to Author: TYRONE JASPER C. PIAD| Date: Tue, 24 Sep 2019 16:19:19 +0000
JOLLIBEE Foods Corp. (JFC) on Tuesday completed its $350-million (P18.2-billion) acquisition of US specialty coffee and tea chain The Coffee Bean & Tea Leaf.
In a disclosure, the listed fastfood giant said the “closing of the transaction was effected after the parties had completed the necessary closing conditions, including required government approvals, provided under the executed purchase agreement.”
Regarded as its biggest acquisition so far, Jollibee’s purchase of the coffee chain would increase its global system wide sales, total store network and worldwide sales contribution by 14 percent, 26 percent and 36 percent, respectively.
Coffee Bean is seen to account for 14 percent of the fastfood chain’s worldwide system sales following the transaction.
The completion comes more than two months after Jollibee said it would purchase Coffee Bean through its Singapore-based subsidiary Jollibee Worldwide Pte. Ltd., which would invest $100 million (P5.2 billion) in a new holding company to serve as the acquiring entity.
Jollibee owns 80 percent of the new firm, and the rest by members of the family that owns Viet Thai International Joint Stock Co., a Jollibee Group partner in the Superfoods Group, which owns and operates Highlands Coffee and Pho24.
“Combined with Highlands Coffee, with business mostly in Vietnam, this acquisition will enable JFC to become an important player in the large, fast growing and profitable coffee business,” Jollibee said.
The remaining $250 million (P13 billion) is being used to pay for advances to the new firm’s issuance of preferred shares over the next six to nine months.
Jollibee saw its consolidated net income dip by 35.85 percent to P2.42 billion in the first half from P3.76 billion in the same period last year on the back of the higher manufacturing expenses of Red Ribbon and losses from US brand Smashburger.
Jollibee shares decreased by 20 centavos or 0.09 percent to close at P220 apiece on Tuesday.