Jollibee divests Taiwan, China businesses

ABS-CBN News

Posted at Dec 09 2009 11:44 AM | Updated as of Dec 10 2009 12:01 AM

MANILA, Philippines - Homegrown fastfood giant Jollibee Foods Corp. (JFC) has divested from two businesses in Taiwan and China, saying it wants to focus on bigger restaurant chains in the latter.

JFC announced Tuesday it signed separate deals, divesting Lao Dong Pte. Ltd. (Singapore) and Chun Shui Tang from its business portfolio "effective immediately." The businesses accounted for less than 1% of JFC's global sales.

JFC and its partners in Lao Dong agreed to terminate the joint venture, which had 8 restaurants in Taiwan and was planning to open more outlets in China.

Early this year, JFC spent P61.1 million for a 70% stake in Lao Dong and committed another P30.6 million for its expansion. The company did not disclose what will happen to its investment.

Aside from Lao Dong, JFC also ended a franchise deal with Ice Tea International for Chun Shui Tang stores in China. JFC was operating two Chun Shui Tang outlets in Shanghai but had shut these down.

"JFC will focus on building bigger brands in the People's Republic of China," it said.

Yonghe King and Hong Zhuang Yuan, JFC's remaining businesses in China, currently account for 9% of the company's worldwide sales. The two brands have a total of 197 stores.

From July to September, JFC said its foreign businesses grew by 53%, while sales rose by 76%. In China alone, JFC's sales were higher by 36% compared to the same period last year.

"JFC will have opened a total of 35 stores there in 2010 and in the years ahead. JFC also plans to acquire more restaurant businesses in China," JFC said.

JFC has the largest food service network in the Philippines, which includes Jollibee, Chowking, Greenwich, Red Ribbon, Delifrance, and Manong Pepe's. As of end-October, the company operates a total of 1,537 stores nationwide and 322 stores abroad.