JOLLIBEE Bond Offering Earns 600M for Recouping COFFEE BEAN Acquisition Debts

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In business, the acquisition of a company by another is always a complicated process, and costs quite a lot too. Such expenditures often come with accruing debts to afford the acquiring of the firm that will become the newest part of the acquirer’s organization. Jollibee Foods, the biggest fast-food chain in the Philippines, certainly racked up some debts when it bought up American coffeehouse chain The Coffee Bean & Tea Leaf. To begin paying up those debts, JFC made an offering of some of its fixed income security bonds though overseas investor meetings last week. Now the results are in.

ABS-CBN News has it that the bond issue of fixed income securities that Jollibee Foods Corporation began offering since last week has begun to bear fruit. On a finance report dated this Friday, January 17, JFC noted that their offering of bonds has raised about $600 million (or P30.5 billion) in funds so far. It was a generous return for the first bond issue Jollibee has made on the stock market in over 25 years since 1993. After all, the initial offer was only at $400 million, but “strong demand” according to JFC drove the valuation up by so much.

The first priority use for the over 30-billion Peso capital raised by JFC offering its fixed income securities will again be the re-financing of the purchase loans that the Filipino fast-food giant incurred in order to cover the short-term debts from acquiring the Coffee Bean & Tea Leaf, the negotiations for which were concluded only in September of last year. Jollibee notes further in its latest report that once the company has balanced its sheets and paid its loans to buy up CBTL, they can continue funding their overseas expansion. The target goal no less is to become one of the top five restaurant companies in the world someday soon.

Image courtesy of SkyscraperCity

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