By Kimberley Kao


Philippine fast-food giant Jollibee Foods will buy a majority stake in South Korea's Compose Coffee in a deal that values the coffee chain at about $340 million, and marks the restaurant group's latest move to expand overseas.

Jollibee, the largest restaurant operator in the Philippines, said Tuesday it will acquire a 70% stake in Compose Coffee, while a Titan Dining-run fund in which Jollibee has a majority stake will buy a 5% interest.

The remaining 25% stake will be held by South Korea-focused private-equity firm Elevation Equity Partners Korea, Jollibee said, adding that the total consideration for the deal is about $340 million, subject to closing and financial conditions.

Jollibee said Busan-based Compose Coffee, with more than 2,600 stores in South Korea, would be its biggest brand by number of stores operated. The acquisition will take Jollibee's total store network closer to 10,000, with roughly two-thirds located outside the Philippines.

Jollibee described the deal as a gateway to the fast-growing coffee market in South Korea, a country it said ranks third globally in terms of coffee consumption per capita.

The acquisition will add 2% in revenue and 12% in core earnings before taxes, Jollibee said.

Compose Coffee, founded in 2014, sells dozens of kinds of coffee, tea and non-coffee beverages. Its flagship product, Jollibee said, is an Americano that sells for the equivalent of about $1.08.

Manila-based Jollibee, known for a host of fast-food outlets in the Philippines and overseas, has controlling interests in major brands like The Coffee Bean & Tea Leaf and Vietnam's Highlands Coffee. In the United States, it owns Smashburger and has Jollibee branches in more than a dozen states.


Write to Kimberley Kao at kimberley.kao@wsj.com


(END) Dow Jones Newswires

07-02-24 0412ET