Restaurant chain operator Jollibee Foods Corp. said Tuesday it will increase its stake in a private equity fund that owns Tim Ho Wan brand to 85 percent from 60 percent for S$36.3 million, or around P1.3 billion.
Jollibee said in a disclosure to the stock exchange Tuesday wholly-owned subsidiary Jollibee Worldwide Pte. Ltd. would acquire Aragon Investments SPC’s 25-percent stake in Titan Dining LP, the holding entity of Tim Ho Wan.
Jollibee said it would pay Aragon through JWPL in cash. The transaction will be completed by the end of the month.
The fast-food giant first invested in Titan when it acquired 45 percent in the fund for SG$100 million in May 2018.
The fund size of Titan increased from SG$100 million to SG$200 million. This hiked Jollibee’s capital commitment to Titan to SG$120 million equivalent to 60 percent of the fund.
Under the agreement, Jollibee would have the opportunity to acquire a substantial ownership in Tim Ho Wan’s master franchise in the Asia Pacific region when the term of the fund ends in seven years through a purchase mechanism that is provided for in the agreement with Titan.
Jollibee also signed a joint venture agreement with the Tim Ho Wan Group to open and operate Tim Ho Wan restaurants in China.
Jollibee opened in September the first Tim Ho Wan restaurant in Shanghai, marking the Michelin starred restaurant’s entry into the world’s second largest consumer economy.
Aside from Shanghai Jollibee, it will also open Tim Ho Wan stores in Beijing, Shenzhen and Guangzhou. Over the next five years, it plans to open 100 Tim Ho Wan stores in China.
Jollibee has five brands serving Chinese cuisine: Chowking, Yonghe King, Hong Zhuang Yuan, Panda Express and Tim Ho Wan.
“JFC aims to build as an important part of its portfolio a significant business serving Chinese cuisine in different parts of the world,” the company said.
Jollibee group had 3,247 stores in the Philippines and 2,566 stores overseas as of end-September.
The share price of Jollibee climbed 9.3 percent Tuesday to close at P154.60.