MANILA, Philippines?Local fast-food giant giant Jollibee Foods Corp. is selling out of its European deli-inspired Delifrance restaurant chain to focus on larger food brands.
In a disclosure to the Philippine Stock Exchange on Wednesday, JFC said it had entered into an agreement to sell for P100 million the assets of its Delifrance business unit, which has 23 Delifrance restaurants at present, to CafeFrance Corp.
CafeFrance is a recently established wholly owned unit of publicly listed pharmaceutical manufacturing company Euro-Med Laboratories Philippines Inc.
In connection with this deal, JFC's wholly owned subsidiary Fresh N' Famous Foods Inc. (FNF), which operates the Delifrance business unit, will terminate its franchise agreement with Delifrance Asia Ltd. effective Dec. 31, 2010.
"This is part of JFC's intention to concentrate its resources in building larger quick-service restaurant businesses," JFC said in the disclosure.
JFC chief finance officer Ysmael Baysa added that the sale and termination of the operations of Delifrance would not have a material impact on group-wide profits.
Delifrance began operating in the Philippines in 1995, first as a joint venture with Delifrance Asia Ltd. and as an exclusive franchise of JFC since 2006.
"CafeFrance Corp. intends to operate a cafe business in all existing Delifrance store locations under a new cafe concept and a new brand name," the disclosure said, adding that the buyer intended to hire all of the current employees of the Delifrance business unit.
Euromed, which has a cash hoard of P699 million, recently incorporated CafeFrance to diversify into the food and/or restaurant business.
The new subsidiary has authorized capital stock of P500 million of which P150 million has been paid up.
Of the 23 Delifrance stores in the Philippines, JFC operates 20 through FNF while three are operated by sub-franchisees, while there are two satellite booths.
For its part, JFC earlier announced plans to build a new chain of casual dining restaurants specializing in coffee and Italian ice cream or gelato using a newly acquired master franchise for a popular Korean brand.
The new franchise, "Caffe Ti-Amo," will be jointly owned by JFC and a local partner.
The Korean restaurant brand was established in 2006 and has expanded its network to 269 stores to become a very successful chain in Korea, the disclosure said.
The JFC group of companies operates the Philippines' largest fastfood network, with a total of 1,582 stores within the Philippines as of end-July. The flagship Jollibee brand has 702 stores while Chowking, Greenwich and Red Ribbon have 406, 221 and 215, respectively. Manong Pepe's has 15 stories.
JFC also operates 362 stores abroad: Yonghe King with 178 stores in China; Jollibee with 61 stores mainly in the United States; Red Ribbon with 37 stores mainly in the US and Chowking with 36 mostly in the US and Dubai. Another Chinese brand, Hong Zhuang Yuan, has 50 stores.