Jollibee Buys Into Milksha

Jollibee Foods Corporation (JFC), one of the largest Asian food service companies, has disclosed that it will purchase, through its wholly-owned subsidiary, Jollibee Worldwide, Pte. Ltd. (JWPL) a majority stake in the firm that owns Milksha.

Photo Insert: A Milksha branch in Singapore

JFC will purchase shares equivalent to 51% ownership in Milkshop International Co. Ltd. (“Milkshop”) for approximately USD12.8 million. One of the cofounders of Milkshop will continue to retain the 49% ownership of Milkshop.

Completion of this transaction is subject to certain closing conditions, and the final purchase price will be confirmed after closing. Milkshop International Co. Ltd., founded in Tainan City in Taiwan in 2008, is primarily involved in the development, operations, and franchising of specialty tea shops under the trade names Milkshop and Milksha, a popular Taiwanese bubble tea brand.

Milkshop uses only high-quality milk, carefully sourced tea, and natural ingredients. It produces milk from its own dairy ranch, the bubbles of which are free from chemical additives, preservatives, and caramel color. The brewing process varies for each kind of tea to achieve the expected aroma and flavors.

Milkshop has over 250 outlets, with 231 outlets in Taiwan, Hong Kong (4), Melbourne (2), Vancouver (2), and Singapore (12). Total system-wide sales for 2019 amounted to approximately USD66.5 million. In 2020, despite the pandemic, Milkshop generated system-wide sales of USD74.7 million.

Milkshop is generating modest net income and positive earnings before interest, taxes, and depreciation (EBITDA). Bubble tea has been gaining popularity across markets. First introduced in Taiwan in 1987, bubble tea has since grown into a multi-billion-dollar industry worldwide.

This gives JFC the opportunity to participate in this fast-growing beverage category and together with Milkshop’s Founder, grow the Milksha brand globally.

In June 2021, JFC announced that it will be bringing Milksha to Filipino consumers, the Philippines being home to one of the largest milk tea markets in Southeast Asia.

JFC and its subsidiaries, Fresh N’ Famous Foods, Inc (FNF) and Mang Inasal Philippines, Inc. (MI) now have the exclusive rights, through a licensing agreement with Milkshop, to sell and market products under the Milksha brand in their stores. Milksha products will soon be sold in Chowking stores.

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