SM in talks to acquire Goldilocks

The SM group of retail tycoon Henry Sy is in talks to acquire a controlling stake in popular bakery chain Goldilocks Bakeshop, potentially adding a big chain of quick service restaurants to its retailing empire.

Inquirer sources said the discussions to acquire Goldilocks have reached an advanced stage.

The acquisition is seen to add a new format to the SM group’s retail business, already the biggest in the country. This is likewise seen as a brand with potential to grow its overseas presence as well as to expand further through franchising.

Goldilocks is a 51-year-old privately held restaurant chain run by the Yee family, with stores estimated at more than 500, based on the company’s website. Apart from its nationwide footprint, the group has set up shops in the US, Canada and Thailand.

SM Retail has a total of 2,357 stores under its portfolio, made up of 58 department stores (The SM Stores), 1,709 specialty stores, 50 SM Supermarkets, 44 SM Hypermarkets, 170 Savemore stores, 41 WalterMart stores and 285 Alfamart stores as of end-June.

The entry of the SM group in Goldilocks is also seen to be a big boost to the restaurant chain, the group being the biggest developer of shopping malls in the country.

Goldilocks was founded in 1966 when sisters Milagros and Clarita and their sister-in-law Doris decided to open a small bakeshop along Pasong Tamo Street in Makati. A third sister, Maria Flor, suggested that they name the enterprise “Goldilocks” after the character in a fairy tale, intending to make brand recall easier and also because the name suggested luck and prosperity.

The restaurant chain has estimated system-wide sales of more than P7 billion a year.

There have been previous attempts by other restaurant groups to acquire Goldilocks. Over a decade ago, Pancake House—then led by the Lorenzo family—initiated discussions to acquire this chain but the talks did not prosper.

SM Investments Corp.’s SM Retail, the only core business that is not separately listed on the stock exchange, reported a 6-percent year-on-year growth in first semester net profit to P5.2 billion on the back of a 6-percent increase in sales to P131.6 billion. This unit earned 4.4 centavos for every P1 worth of goods sold.

A spokesperson for SM declined to comment.