C01495-2018 |
Title of Each Class | Number of Shares of Common Stock Outstanding and Amount of Debt Outstanding | |
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Common | 1,086,584,067 | |
Treasury | 16,447,340 |
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Subject of the Disclosure |
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JFC Signs Agreement for Additional 45% Share in Smashburger |
Background/Description of the Disclosure |
Further to its February 13, 2018 disclosure, Jollibee Foods Corporation (“JFC”) disclosed today that JFC’s wholly owned subsidiary, Bee Good! Inc. (“BGI”) has executed the Purchase Agreement with Smashburger Master LLC (“Master”) for the acquisition of an additional 45% share of SJBF LLC, the parent company of the entities comprising the Smashburger® business. This will increase BGI’s ownership in SJBF LLC from current 40% to 85%. The transaction, valued at USD 100 million, is expected to be completed in one to two months subject to government approvals in the United States and meeting certain closing conditions. JFC will pay Master through BGI in cash. |
Date of Approval by Board of Directors | Mar 8, 2018 |
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Date of Approval by Stockholders | N/A |
Other Relevant Regulatory Agency, if applicable | United States Federal Trade Commission and Department of Justice |
Date of Approval by Relevant Regulatory Agency | TBA |
Rationale for the transaction including the benefits which are expected to be accrued to the Issuer as a result of the transaction |
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JFC’s acquisition of more shares in Smashburger will allow it to have a more significant business in the United States increasing the sales contribution from that country to JFC’s worldwide system wide sales from present 5% to 15% and the sales contribution from foreign business to worldwide system wide sales from present 20% to 30%. The consolidation of Smashburger into JFC will increase its worldwide store network by 365 stores or +9.6% to 4,162. This will also expand JFC’s geographical presence from 16 countries to 21 adding Costa Rica, Egypt, El Salvador, United Kingdom (England and Scotland), and Panama. |
Description of the transaction including the timetable for implementation and related regulatory requirements, if any |
The transaction, valued at USD 100 million, is expected to be completed in one to two months, subject to government approvals in the United States and meeting certain closing conditions. |
The nature and amount of consideration (e.g. price per share, the aggregate amount) | |
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JFC will pay Master through BGI in cash. |
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Basis upon which the amount of consideration or value of the transaction was determined | |
The purchase price of the transaction is based on a negotiated price between the parties. |
The number of shares to be acquired | Number of membership units to be acquired: 45 Class A Units representing 45% of the outstanding equity of SJBF. |
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Ratio/percentage to total outstanding capital stock | 45 |
Terms of payment | |
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The purchase price shall be paid in cash at closing. |
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Conditions precedent to closing of the transaction, if any | |
The transaction is expected to be completed in one to two months, subject to government approvals in the United States and meeting certain closing conditions. |
Nature and business |
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SJBF is engaged in the business of owning, operating and franchising restaurants operating under the trade name Smashburger. |
Discussion of major projects and investments |
With headquarters in Denver, Colorado, there are 365 Smashburger restaurants worldwide in 39 states in the US and in 10 foreign markets. |
Capital structure
Type of Security | Amount | Number of Shares | |
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Class A units. Note: "Class A units" are equivalent to Common Sock | 100 | 100 |
Type of Security | Amount | Number of Shares | |
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Class A Units | 85 | 85 |
Amount | Not applicable to a limited liability company |
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Number of Shares | - |
Type of Security | Amount | Number of Shares | |
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Class A units | 100 | 100 |
Type of Security | Amount | Number of Shares | |
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Class A Units | 100 | 100 |
Type of Security | Amount | |
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Class A Units | Not applicable |
Name | Number of Shares | % Ownership | |
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Smashburger Master LLC | 60 | 60 |
Effect(s)/impact on the business, financial condition and operations of the Issuer |
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JFC’s acquisition of more shares in Smashburger will allow it to have a more significant business in the United States increasing the sales contribution from that country to JFC’s worldwide system wide sales from present 5% to 15% and the sales contribution from foreign business to worldwide system wide sales from present 20% to 30%. The consolidation of Smashburger into JFC will increase its worldwide store network by 365 stores or +9.6% to 4,162. This will also expand JFC’s geographical presence from 16 countries to 21 adding Costa Rica, Egypt, El Salvador, United Kingdom (England and Scotland), and Panama. |
Other Relevant Information |
Please see attached files as follows: (a) March 8, 2018 disclosure on the execution of a Purchase Agreement for JFC's acquisition of additional 45% share in Smashburger; (b) Financial Statements and (c) February 13, 2018 disclosure. |
Name | VALERIE AMANTE |
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Designation | VICE-PRESIDENT |