JOLLIBEE Foods Corp. (JFC) has taken full control of American burger chain Smashburger, after acquiring the remaining 15% stake in the company’s parent for $10 million.
In a disclosure to the stock exchange on Friday, the homegrown food giant said its wholly-owned subsidiary Bee Good! Inc. (BGI) has purchased Smashburger Master LLC (Master)’s remaining stake from its parent, SJBF LLC. The transaction was paid in cash.
“We look forward to the development of Smashburger into a very strong brand and business in the United States,” JFC Chairman Tony Tan Caktiong said in a statement.
Following the takeover, JFC will infuse $80 million worth of capital into Smashburger by converting a loan of the same amount held by BGI into equity. This will support the brand’s expansion starting 2019.
“We look forward to replicating in Smashburger the significant brand and business development that JFC achieved in practically all its new and acquired businesses in the Philippines, China, Vietnam, and other countries through the introduction of JFC’s business methods,” JFC Chief Executive Officer Ernesto Tanmantiong said in a statement.
JFC started investing in Smashburger in 2015, initially acquiring 40% of the company at $100.25 million. It has steadily increased its stake in the firm over the years before finally gaining full ownership.
Smashburger operates a total of 351 stores across the US, Canada, Costa Rica, Egypt, and the United Kingdom, among other locations. It currently accounts for seven percent of JFC’s consolidated systemwide sales. — Arra B. Francia