Jollibee buys out partner in Greenwich

Fastfood chain Jollibee Foods Corp. (JFC) has bought out its partner’s 20-percent stake in Greenwich Pizza Corp. for P384 million in line with its strategy to consolidate its operations.

With the purchase, Jollibee now owns 100 percent of Greenwich, the leading brand in the pizza/pasta segment in the country. The purchase was paid in cash on Jan. 17, 2006.

Jollibee chairman and chief executive officer Tony Tan Caktiong said the purchase is part of the Jollibee Group’s corporate strategy to acquire businesses or additional stakes in existing businesses and to streamline operations.

"We have been very pleased with our partnership with Green Foods Franchising Inc. over the past 11 years, starting in 1994 when JFC acquired 80 percent of Greenwich Pizza Corp. This buy-out which was arrived at in terms satisfactory to both our partner and to JFC will add sales and profit to and will facilitate in simplifying our operations," Tan Caktiong said.

Tan Caktiong said he is confident about the long-term prospect of the Greenwich brand. "We have built a leading brand over these years. We are confident that this brand will continue to grow robustly in the future," he said.

Greenwich registered total system-wide sales of P3.5 billion in 2004, representing 10 percent of the Jollibee Group’s total system-wide sales.

System-wide sales represent total sales to consumers from both company-owned and franchised stores.

As of end-December 2005, Greenwich had a total of 239 stores of which 128 were company-owned and 111 were franchised stores.

Baysa pointed out that JFC has been accumulating cash reserves for its expansion strategy.

The Jollibee Group has been expanding its business through acquisition and store expansion of existing businesses. In October 2005, Jollibee acquired 100 percent of Red Ribbon Bakeshop for a total amount of P1.8 billion. In March 2004, it acquired 85 percent of the Yonghe King business in the People’s Republic of China for $11.5 million.

The group opened a total of 118 stores worldwide in 2005: Jollibee 39, Chowking 31, Greenwich 18, and Delifrance 7. In the People’s Republic of China, the group opened 17 Yonghe King restaurants and in other parts of the world, 6.

Recently, Jollibee disclosed it will start operating its shared services in early 2006 in order to improve the efficiency of its support group as it grows its business. The Shared Services will operate under the legal entity Jollibee Worldwide Services which has a license to operate as a regional operating headquarters.