MANILA, Philippines – Jollibee Foods Corporation, the country's largest food service company, has fully divested its 55% stake in local China restaurant chain San Pin Wang for RMB 90 million (P650 million).
Jollibee told the Philippine Stock Exchange that the divestment is in line with its plan to focus on building its Yonghe King business, its largest venture in China.
Yonghe King has 315 stores to date, contributing 8% to Jollibee's global system-wide sales.
Jollibee said its wholly-owned subsidiary, Jollibee Worldwide Private Limited, sold its entire shareholdings in San Pin Wang to its joint venture partner Guangxi San Pin Wang Food and Beverage Management Company Limited.
In March 2012, Jollibee acquired 55% of San Pin Wang, with stores mostly in Nanning in Guangxi Province in the southern part of China.
At the time of acquisition, San Pin Wang, which primarily offers low-priced beef noodle, had 34 stores.
San Pin Wang has 71 stores as of end-November, and plans to expand further in 2017 and beyond.
“JFC's divestment of its shareholdings in San Pin Wang is part of its intention to concentrate its resources on businesses with greater potential," Jollibee said in a statement.
On a decline
Jollibee's China operations has been on a decline due to stiff competition.
China is one of the most important overseas markets for Jollibee outside the Philippines.
The fastfood giant said it expects to restore growth in China as early as the 4th quarter of 2016.
Jollibee has two more restaurant chains in China, Yonghe King, acquired in 2004; and Hong Zhuang Yuan, which was bought in 2008.
Last month, through its subsidiary, Jollibee gained full control of its food manufacturing venture in China called Happy Bee Foods Processing, via an asset for equity swap.
Jollibee said the move to acquire 100% ownership of Happy Bee will enable it to concentrate on supporting the growth of its Yonghe King business and on further improving its food quality and increasing the assurance of its food safety.
Jollibee operates the largest food service network in the Philippines.
It has 2,565 restaurant outlets in the country and 671 stores abroad as of October 31, 2016. – Rappler.com