Jollibee Completes Acquisition of 55% of South China Fast Food Business

Pasig–(PHStocks)–Jollibee Foods Corporation (PSE: JFC), through its wholly owned subsidiary Jollibee Worldwide Pte Ltd, completed on Friday, 9 March 2012, its acquisition of 55% of Guangxi San Pin Wang Food and Beverage Management Co. Ltd (San Pin Wang), which operates the San Pin Wang beef noodle business in South China. The remaining 45% is held by Guangxi Zong Kai Food Beverage Investment Co. Ltd (GZK).

San Pin Wang is a fast food chain serving Chinese cuisine, primarily low-priced beef noodles with total sales of Rmb110 million in 2011. It consists of 34 stores located mostly in Nanning City in Guang Xi Province in South China.

This acquisition is pursuant to the framework agreement, which was signed on 30 April 2010, and the share purchase agreement signed on 26 October 2010. JWPL is investing Rmb30 million for its stake in San Pin Wang. As joint venture partners, JWPL and GZK will also place additional investments totalling Rmb20 million into this fast food chain in anticipation of its expansion.

JFC and its partner GZK aim to serve high-quality but low-priced beef noodles to consumers in urban areas in China. SPW plans to expand its operations to other cities in the years ahead.

The Jollibee Group presently owns and operates two businesses in China – Yonghe King, which was acquired in 2004, and Hong Zhuang Yuan, which was bought in 2008. As of 31 January 2012, the two businesses combined had a total of 319 stores, which accounted for 11% of the Jollibee Group’s worldwide system wide sales, a measure of all sales to consumers – both from company-owned and franchised stores. The Jollibee Group also has a 70% interest in Jollibee Foods Processing Pte. Ltd, a commissary in Shucheng, Anhui Province.

The JFC Group operates the Philippines’ largest restaurant network. As of 31 January 2012, it was operating a total of 1,997 stores in the country: Jollibee brand, 746; Chowking, 386; Greenwhich, 204; Red Ribbon, 207; Mang Inasal, 430; and Burger King, 24. Abroad, it was operating 469 stores: Yonghe King, 266; Hong Zhuang Yuan, 53; Jollibee, 78 (US: 27; Vietnam: 31; Brunei: 11; Jeddah: 7; Hong Kong and Qatar: 1 each); Red Ribbon in the US, 33; and Chowking, 39 (US: 19; Dubai: 16; Indonesia: 2; Qatar: 2), for a total of 2,466 stores worldwide.

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