Philippines' Jollibee buys Coffee Bean & Tea Leaf for US$100m close breaking news Business Philippines' Jollibee buys Coffee Bean & Tea Leaf for US$100m FILE PHOTO: A man sits in a The Coffee Bean & Tea Leaf cafe in the rain in the Manhattan borough New York May 27, 2015. REUTERS/Carlo Allegri/File Photo 24 Jul 2019 12:50PM Share via E-Mail Bookmark
MANILA: Philippines' Jollibee Foods Corp said on Wednesday (Jul 24) it is buying US brand Coffee Bean & Tea Leaf for US$100 million.
In a filing to the Philippine Stock Exchange, Jollibee said that it will acquire 100 per cent of the Los Angeles-based speciality coffee and tea brand to boost its overseas sales. Advertisement Advertisement
Jollibee operates the largest fast-food chain in the Philippines with 3,195 restaurants. It also operates 1,418 stores across various brands overseas.
The agreement, entered through its wholly owned subsidiary Jollibee Worldwide, will see the firm investing US$100 million in a new Singapore-based holding company to acquire the American coffee and tea brand.
The acquiring entity will be Jollibee Worldwide's subsidiary Java Ventures, which will eventually be a subsidiary of the new holding company.
"The acquisition of The Coffee Bean & Tea Leaf brand will be (Jollibee Foods Corp)'s largest and most multinational so far with business presence in 27 countries," said Jollibee chairman Tony Tan Caktiong in the filing. Advertisement Advertisement
"This will add 14 per cent to its global system-wide sales, 26 per cent to its total store network, will bring international business' contribution to 36 per cent of worldwide sales and will bring (Jollibee Foods Corp) closer to its vision to be one of the top five restaurant companies in the world in terms of market capitalisation."
Jollibee also operates Highlands Coffee in Vietnam, among other brands worldwide.
"Combined with Highlands Coffee, with business mostly in Vietnam, this acquisition will enable (Jollibee Foods Corp) to become an independent player in the large, fast-growing and profitable coffee business," said Mr Tan.
The Coffee Bean & Tea Leaf will be Jollibee's second-largest business after the Jollibee brand, and coffee business will account for 14 per cent of its worldwide system sales, he said, adding the priority was to "accelerate the growth" of Coffee Bean & Tea Leaf's brand, particularly in Asia. sentifi.com Channel NewsAsia - Sentifi topic widget
An initial public offering of Highlands Coffee initially planned for July this year will be delayed and "re-studied" in light of the acquisition, according to the stock exchange disclosure.
Jollibee's announcement comes as the food operator pushes for sales outside its home market. READ: Busy as a Jollibee: Asia's fast-food giant expands abroad
Its chief executive told Reuters last October that it hopes to generate half its sales outside the Philippines within five to seven years, up from about 30 per cent.
It also hopes to double its revenue in five years, as it expands its own chains and buys others. Source: Reuters/nc
