Jollibee sets Jan. 24 redemption for $300-M securities

By Alexandria Grace C. Magno

JOLLIBEE FOODS Corp. (JFC) will redeem its $300-million guaranteed senior perpetual capital securities on Jan. 24, 2026, through its wholly owned subsidiary Jollibee Worldwide Pte. Ltd. (JWPL).

The securities, originally issued on June 24, 2020, under the $300-million Guaranteed Senior Perpetual Capital Offering Circular, will be canceled and subsequently delisted from the Singapore Exchange Securities Trading Limited upon redemption, the company said in a disclosure to the stock exchange on Monday.

JFC said the Global Certificate representing the securities must be presented or surrendered by Euroclear and/or Clearstream, Luxembourg, to the trustee and/or the paying agent.

SIMPLIFYING AND OPTIMIZING CAPITAL STRUCTURE
According to Toby Allan C. Arce, head of sales trading at Globalinks Securities and Stocks, Inc., the redemption is aimed at simplifying and de-risking Jollibee’s capital structure, taking advantage of the company’s improved operating performance and access to funding.

“These perpetual instruments were originally useful in providing balance-sheet support during expansion phases, but they typically carry higher effective funding costs and add complexity to leverage metrics,” he said in a Viber message.

“By redeeming them now — after successfully raising new, more competitively priced senior debt earlier this year — Jollibee is taking advantage of improved market conditions and investor confidence to streamline its liabilities,” he added.

Mr. Arce noted that the move reflects management’s confidence in the company’s cash flow and balance sheet strength.

“This is a combination of cost optimization and capital-structure cleanup rather than a defensive maneuver. Retiring perpetual securities reduces long-term financing costs, improves transparency in the capital stack, and enhances financial flexibility ahead of further expansion or refinancing needs. While not a strategic reset in terms of business direction, it is a strategic financial housekeeping step that reinforces Jollibee’s positioning as a more mature, globally scaled consumer company with a cleaner and more efficient balance sheet,” he said.

Similarly, Shawn Ray R. Atienza, equity research analyst at AP Securities, Inc., said the redemption shows that JFC has sufficient internal cash flow and visibility into future inflows to streamline its balance sheet without issuing new hybrid securities.

“The move should primarily be viewed as a cost-optimization decision, specifically aimed at lowering interest expenses over the foreseeable future, with capital-structure simplification emerging as a secondary but favorable outcome,” he added.

In March, JFC announced plans to raise at least $300 million through a five-year, US dollar-denominated senior unsecured guaranteed notes issuance under Regulation S to refinance debt. Regulation S issuances are securities offered outside the United States that are not registered under the US Securities Act or any US state securities laws.

On Monday, JFC shares rose 2.64%, or P4.80, to P186.80 apiece.