MANILA, Philippines — Jollibee Foods Corporation (JFC) has chosen to divest a portion of its ownership in Vietnamese coffee chain Highlands Coffee, relinquishing majority control of the business rather than awaiting its long-delayed initial public offering (IPO).
In a disclosure to the Philippine Stock Exchange (PSE) on Thursday, September 24, JFC announced that its subsidiary, JSF Investments Pte. Ltd., signed a share purchase agreement to sell an 11% stake in SF Vung Tau Joint Stock Company—the holding company of Highlands Coffee—to its partner, Viet Thai International Joint Stock Co. (VTI).
The transaction is valued at VND2.3 trillion, or $88 million (plus adjustments), giving the Vietnamese coffee brand an implied equity valuation of $800 million. The figure marks a substantial premium over the carrying value recorded in Jollibee’s books.
Following the deal, Jollibee’s ownership in Highlands Coffee will drop to 49%, while VTI will assume majority control with 51%.
JFC first acquired a 50% stake in the coffee chain in 2012 for $25 million, later purchasing an additional 10% in 2017. Although an IPO was initially scheduled for 2019, the public listing was repeatedly postponed, with recent company projections pointing toward 2027.
Brokerage firm Abacus Securities Corporation noted that the transaction demonstrates a roughly 16-fold valuation growth over 14 years. Abacus added that the sale generates earnings that support JFC’s capital preparations for the planned international unit IPO, JFC International (JFCI), in 2027.
Jollibee stated that the $88 million proceeds will go toward debt reduction, funding high-growth ventures, and returning value to shareholders.
“Vietnam is where we proved the Jollibee Group model can succeed internationally. Together with our partner, we transformed Highlands Coffee from a little over 50 stores at the time of our initial investment into a category leader with more than 1,000 stores today,” said Jollibee President and Chief Executive Officer Ernesto Tanmantiong.
“Our capital allocation discipline is about visible, measurable value. This transaction establishes an independent value for our Vietnam coffee platform at a substantial premium to its carrying value… and retains a 49-percent economic interest in a platform delivering high double-digit revenue growth and best-in-class store-level profitability and payback,” added JFC Global Chief Financial and Risk Officer and JFCI CEO Richard Chong Woo Shin.