Shakey’s eyes 20 stores in 2017 expansion binge

Pizza chain Shakey’s Pizza Asia Ventures Inc. (Spavi), which is seeking to raise P3.96 billion through an initial public offer (IPO), targets to put up 20 new stores next year, as it embarks on an ambitious expansion plan.

Spavi President and Chief Executive Officer Vicente Gregorio bared this after the company signed a deal with a Middle Eastern partner for its first international franchise in Kuwait.

“It’s 10 stores for the next seven years. The first store should be up in the first half of next year,” he told reporters.

But Gregorio stressed that while there are a lot of franchise inquiries from oth­er countries, including Asean, New Zealand and Australia, the company has been cau­tious on these deals.

“The focus of the com­pany is still to develop and expand the brand here in the Philippines. We will be very careful in doing that interna­tional expansion… We have seen others grow and expand and then scale down because it did not work. We want to be having profitable franchisees, local or international,” he rea­soned.

Gregorio said they will fo­cus on expanding in Visayas and Mindanao, as well as in provincial Luzon.

“Just here in VisMin (Vi­sayas-Mindanao), we are un­derpenetrated,” he noted. “There are (also) still opportu­nities outside extreme north­ern Luzon and southern Lu­zon.”

Spavi hopes to end 2016 with 184 stores, with the open­ing of 17 new stores this year. It expects to open 20 more new stores next year, bringing the total to 204 stores by Decem­ber 2017.

“After next year, we are still seeing 12 to 15 new stores added to the system, which will sustain the growth,” Gregorio said.

He further said the com­pany has been posting dou­ble-digit growth for the last 13 years bolstered by new store openings.

“How do you continue to grow? The main thrust to sustain this kind of an upward trajectory is to expedite our expansion for new stores,” he said.

Meanwhile, Spavi is of­fering 351.9 million shares, including an over-allotment option of up to 45.9 million shares from December 2 to 8. Offer price is P11.26 apiece.

Listing on the Philippine Stock Exchange is set on De­cember 15.

The country’s leading chained full-service restaurant intends to use 87.3 percent or P940.3 million of the net pro­ceeds from the sale of primary shares to repay debt.

The remaining P137 mil­lion will fund the capital ex­penditures for its commissary expansion and for relocation of its corporate headquarters.

Eduardo Francisco, presi­dent of Banco de Oro Capital & Investment Corp., said the share sale is “oversubscribed”.

“We are confident that we will do very well despite the Fed rate increases, OPEC (Or­ganization of the Petroleum Exporting Countries’ deal to reduce production). This is a very stable company with good growth prospects so we are sure it will (also) do very well post-IPO. IPO substantially is oversubscribed so we are hap­py about that,” he said in an interview.

BDO Capital was tapped as one of the joint lead managers and joint domestic underwrit­ers. RIZA LOZADA