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Thursday, March 28, 2024

Jollibee plans to issue dollar debt paper to retire old loans

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Fast-food giant Jollibee Foods Corp. plans to issue US dollar-denominated debt paper to refinance short term debt from the acquisition The Coffee Bean & Tea Leaf.

Jollibee said in a disclosure to the stock exchange Thursday wholly-owned unit Jollibee Worldwide Pte. Ltd. tapped Citigroup Global Markets Singapore Pte. Ltd. and J.P. Morgan Limited as joint global coordinators, and Citigroup, Credit Suisse, J.P. Morgan and Mizuho Securities as joint lead managers and joint book-runners to arrange a series of fixed income investor meetings in Hong Kong, Singapore and London starting on January 13.

“A Reg S only US dollar-denominated guaranteed Senior Perpetual Capital Securities offering may follow subject to market conditions,” the fast-food company said.

Jollibee plans to use proceeds from the contemplated offering to refinance the short-term debt from the acquisition of CBTL completed in September as well as fund general corporate activities.

Jollibee acquired a 100-percent stake in CBTL for $350 million (P18.3 billion) on a debt-free basis.

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The acquisition was done through Java Ventures LLC, a US-based wholly-owned subsidiary of Super Magnificent Coffee Company Pte. Ltd. (SMCC Singapore). 

The payment for the acquisition of CBTL was funded by proceeds from bridge loans entered into by JWPL with several financial institutions. 

The acquisition of CBTL brand is Jollibee group’s largest and most multinational to date. It will add 14 percent to JFC’s global system-wide sales, 26 percent to total store network and bring the contribution to 36 percent of worldwide sales.

Jollibee earlier expressed plans to bring in strategic investors to help turn around CBTL.

Before acquiring CBTL, Jollibee purchased several global brands in a bid to be among the world’s five largest food operators.

Recent acquisitions include Colorado-based Smashburger and Mexican fast-casual chain based in Chicago Tortas Frontera.

The Jollibee group as of end of September was operating 3,238 restaurant outlets in the country—Jollibee brand 1,174, Chowking 602, Greenwich 282, Red Ribbon 489, Mang Inasal 586, Burger King 104 and PHO24. It had 1,451 stores abroad.

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