The Po family have made back-to-back deals to acquire 60-year-old sardine maker Ligo and well-known food kiosk chain operator Potato Corner, expanding the empire of food manufacturing and retailing. of the group.
Century Pacific Food Inc. (CNPF) expanded its shelf life offering for the mass market with the acquisition of Ligo from the Tung family, while leading restaurant chain Shakey’s Pizza Asia Ventures Inc. bagged Potato Corner , which has more than 1,000 points of sale across the country and a growing international footprint.
Shares of Shakey’s, which trade on the Philippine Stock Exchange under the symbol PIZZA, rose 8.9% while CNPF gained 1.8% when the repurchase agreements were disclosed on Friday.
These acquisitions were approved by the boards of directors of each company Thursday evening, but the price will be determined at a later date.
âThe acquisition of Ligo by the Po family will add value to CNPF’s portfolio as Ligo is a market leader in the country and has a long-standing business in the sardines category. It will be very synergistic with Ligo’s product line of long-life marine products, âsaid Luis Gerardo Limlingan, Managing Director of local brokerage Regina Capital Development.
âIn addition, the acquisition of Potato Corner will help strengthen PIZZA’s 2022 strategy to actively pursue store openings as part of the country’s economic reopening. Potato Corner is one of the most established local food kiosk chains, not only nationally but also globally with its fast growing franchisees, particularly in the United States, Thailand and Indonesia, âhe said. added.
Shakey’s will take over the assets and intellectual property of Potato Corner, own and operate all company-owned stores, and serve as the brand owner and franchisor of the franchise-operated stores. This kiosk chain operator is popular for its freshly baked flavored potato fries.
âPotato Corner is a profitable addition to PIZZA’s list of ‘wow’ brands. Its co-founder, Jose Magsaysay, has truly established a strong brand base with a product that resonates universally with consumers. The current scale of Potato Corner and the brand love it receives from consumers is a testament to that, âsaid Vicente Gregorio, President and CEO of Shakey’s.
âThis is an accretive acquisition. Nonetheless, we will continue to maximize synergies and use our expertise in business development, franchise management and supply chain operations to further develop the brand in a sustainable manner, âhe added.
Christopher Po, chairman of Shakey, said the acquisition of Potato Corner would allow the group to cultivate entrepreneurship as one of its pleas. âPotato Corner has more than 600 MSME franchisees (micro, small and medium business). We intend to work closely with them to ensure the success of their business. The more we develop the activities of Potato Corner, the more we encourage entrepreneurship, âhe explained.
Since its creation in 1992, Potato Corner has built a “solid brand equity and demonstrated solid performance, attractive margins and the ability to scale”, all aligned with its acquisition criteria, according to the communicated.
Like most restaurant businesses nationwide, Potato Corner suffered a heavy blow during the protracted pandemic, but has shown resilience and has consistently emerged with profitable returns, the disclosure added.
CNPF will also purchase assets and intellectual property related to the manufacturing business of Ligo, a market leader in key regions of the Philippines.
âLigo is a leading brand in the sardine category. Ligo will be highly synergistic with the rest of our long-life marine products. We are deeply touched that the Tung family has entrusted this brand to our company, and we will do everything possible to honor this legacy brand and continue its legacy, âsaid Po.
âIt will be an accretive and targeted acquisition. We anticipate synergies in sales and distribution, supply chain and marketing. In addition, this acquisition is very much aligned with our mission to provide affordable food to our consumers. Our company has a long-standing activity in the category of sardines. We will leverage our size and experience to create more value for the brand, which in turn will strengthen our core business, âhe added.
Canned sardines are among the main staple foods in the Philippines, being one of the most accessible sources of protein and calcium for Filipino consumers. These are considered essential commodities that support food security in the country.
CNPF is one of the largest manufacturers and exporters of marine products. It is home to house brands such as Century Tuna, 555, Blue Bay and Fresca. The company is also a leader in the meat market and has a strong emerging business in dairy and coconut products.
This acquisition is part of the constitution of CNPF’s portfolio, whether through organic expansion or acquisition.
In early 2021, the company announced the acquisition of Pacific Meat Company, Inc., an emerging player in the large chilled food category.
It also entered fast growing categories such as herbal alternatives and pet food through new brands, âunMEATâ and âGoodestâ, respectively. CNPF recently announced the expansion of its dairy business, launching a new brand âChoco Heroâ to compete in the chocolate malt segment.
CNPF expects to end 2021 with revenue growth of 10-15% and net income growth of nearly 20%.
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