Ayala- SSI joint venture mulling options for FamilyMart business
THE JOINT venture of Ayala Land, Inc. (ALI) and SSI Group, Inc. is exploring options to strengthen its FamilyMart convenience store business in the country, amid intensifying competition.
In separate disclosures on Monday, ALI and SSI said SIAL CVS Retailers, Inc. is planning to make changes in the growth strategy for the FamilyMart chain.
However, SSI noted “no definite course of action has been finalized.”
“We wish to advise that SIAL CVS Retailers, Inc., a joint venture between (SSI) and (ALI) is currently exploring various options intended to strengthen and grow the business of Philippine FamilyMart CVS, Inc.,” SSI said in a disclosure, following reports of the company’s possible sale.
The Japanese convenience store chain entered the Philippine market after SIAL signed a deal with FamilyMart Co. Ltd. and Itochu Corp. in 2012.
The company currently operates 72 stores in the country, giving it a smaller market share compared to its competitors. For instance, Philippine Seven Corp., the local operator of 7- Eleven convenience stores, has over 2,000 stores under its portfolio.
In March 2016, SIAL sold its Wellworth department stores to Metro Retail Stores Group, Inc. ( MRSGI) for P498.81 million, barely two years after opening its first store. MRSGI acquired the fixed assets of the Ayala Land- SSI joint venture’s department stores located at Fairview Terraces Mall and UP Town Center Mall.
The Tantoco- led SSI said it has been implementing measures to maximize the efficiency of its store network since 2016.
“Further to these measures, the Company has seen a return to growth which is reflected in SSI’s first half 2017 results,” it added.
SSI delivered a 14% increase in its net income attributable to the parent in the first half of 2017 at P274 million, amid a 1.9% dip in revenues to P8.42 billion during the period.
Shares in ALI rose 40 centavos or by 0.93% to close at P43.30 each, while SSI shares rose by five centavos or 1.2% to P4.23 apiece at the stock exchange on Monday. —