Jollibee Foods Acquires 70% Of South Korea's Compose Coffee In $238 Million Deal
Jollibee Foods Corp., the Philippines' largest fast-food chain, is set to acquire a 70% stake in South Korean coffee chain Compose Coffee for $238 million. The Manila-based company aims to expand its global coffee and tea businesses with this acquisition.
Jollibee Worldwide Pte. Ltd will acquire the majority of the Korean brand, while Titan Fund and South Korean private-equity firm Elevation will assume the remaining 5% and 25%, respectively. The total transaction amount is approximately $340 million.
Compose Coffee: A strategic fit for Jollibee Foods
In a statement, Jollibee Foods said that Compose Coffee is a compelling strategic fit for the company and is on track to become South Korea's largest, fastest-growing, and leading value coffee player. Established in 2014, Compose Coffee operates around 2,500 franchise shops across the country as of March. Following the acquisition, it will become Jollibee's biggest brand by store count, with an expected increase in the store network to nearly 10,000.
Known for its budget-friendly coffee offerings, Compose Coffee recorded 88.9 billion won in revenue last year, marking a 20.5% increase compared to the previous year. Its profit rose by 47% on-year to reach 36.7 billion won. Currently, Kim Tae-hyung (V) of BTS serves as the brand ambassador for the coffee chain.
The acquisition of Compose Coffee adds to Jollibee Foods' growing coffee and tea portfolio, which includes Highlands Coffee, Milksha, Coffee Bean, Common Man Coffee Roasters, and Tea Leaf.
Jollibee Foods' acquisition of a majority stake in Compose Coffee demonstrates its commitment to expanding its global presence in the coffee and tea market. The deal also highlights the potential growth opportunities in South Korea's value coffee sector.
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