By THEPHILBIZNEW STAFF
As soon as Jollibee Foods Corp. (JFC) announced its acquisition of Coffe Bean and Tea Leaf (CBTL), based in Los Angeles, California, for $350 million (roughly P18 billion), the stock market has reacted in a way that showed apparent displeasure among the fastfood giant’s investors.
Last Wednesday, JFC’s stock plunged 8 percent to P251, marking its ebb – the lowest since November, 2016. In terms of value, this is about 5.75 million shares worth P1.5 billion changing hands.
Market watchers have pointed out in their posts on Instagram how the acquisition bodes well with CBTL standing to add $313 million or 10 percent to JFC revenues.
However, the flipside of it is that CBTL had lost $21 million in 2018 which, according to stock market pundits, is equivalent to 12 percent of JFC’s profits.
Tony Tan Caktiong, chairman of JFC, had been upbeat in announcing that his company, which has grown to be Asia’s largest foodchain, was investing in investing the CBTL specialty coffee and tea brand.
“The acquisition of The Coffee Bean brand will be JFC’s largest and most multinational so far with business presence in 27 countries. This will add 14% to its global system wide sales, 26% to its total store network, will bring international business contribution to 36% of worldwide sales and will bring JFC closer to its vision to be one of the top 5 restaurant companies in the world in terms of market capitalization,” he said.