Restaurant chain operator Jollibee Foods Corp. said Wednesday it is infusing S$45 million or P1.74 billion into a private equity fund that is set to acquire the master franchise of Michelin-starred dim sum restaurant chain Tim Ho Wan in Asia Pacific.
Jollibee chairman Tony Tan Caktiong said the investment would provide Jollibee the opportunity to have a significant interest in the Tim Ho Wan franchise in the long term and bring healthy financial returns to the company.
“Our long-term interest in Tim Ho Wan is in line with JFC’s mission: to serve great tasting food and spread the joy of eating to everyone,” Tan Caktiong said.
Tim Ho Wan, which originated in Hong Kong in 2009, was dubbed as the world’s most affordable Michelin-starred restaurant. Its restaurants are typically full-packed with long waiting line at lunch and dinner.
Jollibee through wholly-owned subsidiary Jollibee Worldwide Pte. Ltd. will invest in Titan Dining LP, which has a binding agreement for the acquisition of 100 percent of the Asia Pacific master franchise holder of the Tim Ho Wan brand, Tim Ho Wan Pte. Ltd. and its affiliate Dim Sum Pte. Ltd. which owns and operates Tim Ho Wan stores in Singapore.
Jollibee reported a net income of P1.8 billion in the first quarter, up 17.3 percent from a year ago, as revenues rose 18.8 percent to P34.8 billion.
THWPL holds the exclusive long-term master franchise to operate “Tim Ho Wan” food and beverage business in the Asia Pacific region (excluding Hong Kong).
Aside from DSPL in Singapore, THWPL also has franchisees in Cambodia, Indonesia, Japan, Macau, Taiwan, Thailand, Vietnam, Australia and the Philippines, with further development planned in the Asia Pacific.
There are 40 restaurant outlets under THWPL and DSPL, both company-owned and franchised stores.
Titan has a fund size of S$100 million, with Jollibee’s planned investment constituting 45 percent of the total committed investments in Titan, and the balance coming from other investors.
Jollibee said Titan could eventually add other brands in the food service sector to its portfolio, with the objective to grow strong Asia Pacific food service brands across multiple geographies and markets and to bring strong global food service brands to Asia Pacific.
Jollibee said the agreement would enable it to have the opportunity to acquire a substantial ownership in Tim Ho Wan’s master franchise in the Asia Pacific region when the term of the fund ends in seven years, through a purchase mechanism that is provided for in the agreement with Titan Dining LP.
Jollibee said to prepare for this eventuality, it would operate as a franchisee of Tim Ho Wan in Shanghai, China.