The Market Monitor Minding the Nation's Business
Fastfood giant Jollibee Foods Corp. (JFC) has acquired full ownership through its international unit of the Chinese supplier of its operations in China after JFC engaged in an equity and asset swap deal worth P500 million.
“This is effectively an equity share and asset swap. JFC will not have a net cash outlay for the acquisition of the 30-percent share,” the firm reported to the bourse.
JFC reported that the acquisition entails 3.5 million shares equivalent to 30 percent of the total outstanding shares of Happy Bee with a price per share of approximately at $2.96 for a total consideration of $10.4 million (P499.2 million).
The deal resulted in JFC’s unit Jollibee Worldwide Pte. Ltd. (JWPL) acquiring a 30-percent stake of its Chinese partner in Happy Bee Foods Processing Pte. Ltd. in a bid to grow its Yonghe King business.
JWPL reached an agreement with Hua Xia Harvest Holdings Pte. Ltd. (Hua Xia) to acquire Hua Xia’s entire equity shareholding in the joint venture entity, Happy Bee. With this acquisition, JWPL now owns 100 percent of Happy Bee.
Happy Bee owns 100 percent of the equity interests in Happy Bee Foods Processing (Anhui) Co., Ltd. (Happy Bee Anhui), a wholly foreign-owned enterprise incorporated in the People’s Republic of China, and operates a manufacturing facility in Anhui, China that currently services the requirements of JFC’s Yonghe King business and produces and sells food products for business institutions other than JFC’s brands.
Under the terms of the agreement, Hua Xia sold and conveyed to JWPL its 30-percent equity interests in Happy Bee while Happy Bee (Anhui) shall sell and convey to Hua Xia’s nominee entity the assets and contracts related to the third party supply business.
“JFC is acquiring the 30-percent share of Happy Bee for approximately $10.4 million in the form of assets related to the production of food products intended for institutions outside of JFC brands in China,” JFC reported to the Philippine Stock Exchange (PSE).
“The current indicative consideration amount approximately of $10.4 million (P499.2 million) is subject to adjustments based on the due diligence results on the assets and in accordance with an agreed adjustment mechanism,” JFC disclosed.
JFC expects to further improve its food quality and increase assurance on food safety with this latest acquisition of Happy Bee.
RIZA LOZADA