Tycoon Tony Tan Caktiong’s Jollibee to Buy $ 250 Million in Bonds; European expansion projects
Jollibee Foods, controlled by billionaire Tony Tan Caktiong, on Tuesday offered to buy back bonds worth $ 250 million as the Philippine fast food giant steps up its global expansion plans with the opening of new stores in Europe.
The bonds listed on the Singapore Stock Exchange are among $ 600 million of senior permanent equity securities issued by Jollibee in January 2020 as the Covid-19 pandemic began to wreak havoc on the global economy. The bonds helped Jollibee refinance the short-term loans used to acquire Coffee Bean & Tea Leaf in September 2019.
Jollibee Worldwide, a wholly-owned subsidiary of the Philippines-based company, made a partial takeover bid for the bonds this week. The call for tenders ends on November 3.
“The takeover bid is part of Jollibee’s liability management strategy to strengthen its balance sheet,” the company said Tuesday in a statement to the Philippine Stock Exchange. Funding for the takeover bid will come from the 12 billion pesos ($ 236 million) the company will raise from the sale of preferred shares that was announced in May, he said.
Completing the preferred stock issuance and partial bond buyback will help Jollibee reduce its foreign debt obligations, reduce currency risks and improve its debt and debt service ratios. “All of these actions will help Jollibee to maintain its ability to finance its profitable growth, which is expected to accelerate in the coming months and years, as the group plans to accelerate the expansion of its stores around the world in 2022 and beyond. beyond, ”Jollibee said.
As part of its global expansion frenzy, Jollibee on Tuesday announced the opening of 50 new fast food outlets across Europe over the next five years. The company opened two new outlets in the UK and its first restaurant in Madrid, Spain, earlier this year.
Jollibee fell into the red in 2020, with an annual net loss of 11.5 billion pesos, as cities around the world were stranded to stop the spread of the Covid-19 pandemic, forcing the company to shut down some 70 points of sale abroad. The company went back into the dark in the fourth quarter and made a net profit of 1.1 billion pesos in the first half of the year ended June 30.
Founded by Tan Caktiong over 40 years ago, Jollibee now operates nearly 3,200 outlets in the Philippines and more than 2,600 overseas, including US chains Smashburger and Coffee Bean. With a net worth of $ 2.7 billion, Tan Caktiong, 68, was ranked No.7 on Forbes Asia list of the 50 richest people in the Philippines released last month, with a net worth of $ 2.7 billion. He also owns a stake in developer DoubleDragon Properties.