MANILA, Philippines - Pancake House Inc. on Wednesday announced it is acquiring pizza chain Yellow Cab Pizza Co. for P800 million.
In a press conference, Pancake House chairman Martin P. Lorenzo said the company had signed a memorandum of agreement to purchase Yellow Cab. .
"The acquisition of Yellow Cab is projected to propel the Pancake House Group's consolidated system sales to over the P4 billion mark, sales and turnover of P3.7 billion, and Ebitda (earnings before interest, taxes, depreciation and amortization) of P524 million for 2012," he said.
With the Yellow Cab acquisition, Lorenzo said the group will end the year with 290 stores and 310 by 2012. He also noted the pizza chain perfectly complements the group's other brands.
"We view it as an established top of mine, premium pizza brand and a profitable business in its own right, yet we also see much more potential for increased synergy in the short term and sustainable growth over the medium to long term," he added.
Funding for the acquisition will primarily come from internally generated funds, although the company has secured an P800 million term loan facility from Metropolitan Bank and Trust Co.
The transaction is expected to be completed in 30 days.
Yellow Cab was established in 2001 and specializes in New York-style pizza. It now has more than 1,500 employees and restaurants in Qatar, Malaysia, Guam and the mainland US. At present, Yellow Cab has 87 outlets, of which 69 are owned by the company.
Aside from its flagship brand Pancake House, the Lorenzo-led group currently owns and operates Teriyaki Boy, Dencio's, Kabisera, Sizzlin Pepper, Chinese Rice Shop, Singkit and Le Couer de France.