Jollibee readies P8-B preferred share offer

FAST-FOOD chain operator Jollibee Foods Corp. (JFC) is looking to raise up to P8.0 billion in fresh funds via a public offering of up to 8.0 million cumulative peso-denominated perpetual preferred shares.

In a disclosure on Monday, the firm said its board of directors had greenlit an offering of 5.0 million preferred shares, with an oversubscription option of up to 3.0 million, at a price of P1,000 each.

“JFC is undertaking this funding transaction to maintain strong capital structure, robust leverage position, and optimize liquidity by managing maturities of financial obligations,” it added.

“A portion of the net proceeds from the offering will be used to refinance financial obligations, including JFC’s callable Series A preferred shares, which [are] due in October 2024 and for other general business purposes.”

non-participating, The offering of non-voting, non-convertible, redeemable peso-denominated preferred shares will comprise the second tranche of a shelf registration approved by the Securities and Exchange Commission (SEC) in September 2021.

The tranche will be listed on the Philippine Stock Exchange (PSE), and issuance and listing are subject to the approval of the SEC and the PSE, respectively.

This latest offering “will come from the reclassification of the existing authorized and unissued common shares of JFC, thus not expanding the total number of authorized shares in its equity base.”

The homegrown fast-food giant also said the issuance would not affect the implementation of its current cash dividend policy.

“The dividend rate and other terms of the planned additional preferred shares will be determined at the time of pricing of the offering,” it added.

BPI Capital Corp., Chinabank Capital Corp., and BDO Capital were named as the joint underwriters for the transaction.

The first tranche was issued in 2021 when JFC offered 3.0 million Series A preferred shares and 9.0 million Series B preferred shares. Series A and Series B carried dividend rates of 3.2821 percent and 4.2405 percent per annum, respectively.

The company’s attributable net income in the first nine months of 2023 dipped by 5.7 percent to P6.8 billion from P7.2 billion the year before, while consolidated revenues grew 18 percent to P177.41 billion from P150.36 billion.

As of end-December of last year, JFC operated 6,885 stores worldwide, 3,339 of which were located in the Philippines.

JFC shares on Monday were down by P4, or 1.52 percent, at P260 each amid a 1.01-percent decline for the benchmark PSE index.