Jollibee prices $600-M capital raising activity

Published January 26, 2020, 12:00 AM

by manilabulletin_admin


Jollibee Foods Corporation (JFC) is raising $600 million through the issuance of Reg S only US dollar-denominated guaranteed senior perpetual capital securities by wholly- owned subsidiary Jollibee Worldwide Pte. Ltd., the first by an Asian restaurant company.

The firm disclosed that it has successfully priced the securities offering with an initial distribution rate of 3.9 percent, non-call (5 years) and payable semi-annually.

This transaction represents the first-ever bond or perpetual securities issuance from JFC and the first time that JFC has tapped the capital markets since its initial public offering in 1993. This issuance is one of the first by an Asian restaurant company.

The securities are unrated and will be listed on the Singapore Exchange Securities Trading Limited.

Proceeds from the offering are intended primarily to refinance the short-term debt from the acquisition of International Coffee and Tea, LLC (The Coffee Bean & Tea Leaf) as well as to fund initiatives aligned with its general corporate purposes.

The securities will be accounted for as equity. The objective of management for this issuance is to further strengthen the balance sheet of JFC to build a stronger foundation for accelerating its growth in order to achieve its vision to become one of the top five restaurant companies in the world.

“The transaction was oversubscribed by almost 10 times the original intended issue amount of $400 million, allowing the company to upsize the transaction to $600 million and tighten final pricing by 35 basis points to 3.9 percent from the initial price guidance of 4.25 percent,” JFC said.

It further noted that, “this marks the lowest pricing for a 5-year perpetual securities issued by a Philippine company reflecting the strong demand for a JFC bond and the reputable credit standing of the company.”