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Figaro Coffee Group Files for P1.78 Billion IPO

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Filipino coffee and food chain Figaro Coffee Group Inc has filed for an initial public offering (IPO) on Thursday (November 4). In its prospectus submitted to the Securities and Exchange Commission, the homegrown company best-known for its chain of retail coffee shops called Figaro Coffee is planning to offer 1.26 billion common shares priced at P1.28 per share, plus an overallotment option of up to 126 million shares. 

Assuming the full exercise of the overallotment option, the company expects to earn as much as P1.78 billion based on the total offer of 1.386 billion shares at P1.28 per offer share.

The company says it intends to use proceeds from the IPO to fund more store openings and renovations, expand its commissary, debt repayment, IT infrastructure developments, and potential acquisitions.

The company had been talking about going public since at least 2006

The Figaro Coffee Group is a diversified food group with over 90 branches across the country and internationally. It currently operates 52 of its Figaro coffee shops, 31 Angel’s Pizza outlets, five Tien Ma’s Taiwanese cuisine restaurants, one TFG Express outlet, and one Café Portofino outlet.

Its flagship brand, Figaro Coffee was founded in 1993 and is a pioneering coffee chain in the Philippines. Besides its local stores, Figaro has three outlets in Saudi Arabia and one in Qatar.

Angel’s Pizza, meanwhile, started operations in 2009 under Zuriel Pizza and Pasta and merged with FCSI in 2009. There are currently 17 company-owned and 14 franchise Angel’s Pizza stores.

FCSI bought Tien Ma’s from a Taiwanese couple in 2015 and opened the first store on the same year. It serves authentic Taiwanese dishes at an affordable price. There are a total of three company-owned and two franchise stores. It opened its first branch in Cebu in 2019.

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The Figaro Group Express is a multi-brand kiosk that serves some of the top-selling products of Figaro, Angel’s Pizza, Tien Ma’s and TFG Online. The first TFG Express kiosk is located in Congressional Avenue, Quezon City and opened in August 2021. The company says it plans to open 10 more TFG Express kiosks in Metro Manila by the end of the year.

Finally, Café Portofino is a value-for-money concept that serves hot and cold beverages and select bakery items. It’s intended to operate in schools, universities, hospitals and offices. Two company-owned outlets that opened near University of Santo Tomas and Miriam College and in 2018 to 2019 closed down due to non-profitability. The lone existing outlet is a franchise store located in Camalig, Albay.

The company reported total systemwide sales of P873.47 million and net income of P103.30 million in 2020. It also reported a net income of P114.45 million for the first six months of 2021, up from the P30.85 million it earned during the same period a year earlier.

“The Philippines is one of the most dynamic economies in the East Asia Pacific region and its GDP grew organically between 2016 and 2019 before experiencing a decline due to the COVID-19 pandemic in 2020,” the company said in its prospectus submitted to the SEC. “We believe that we are well positioned to capture these growth opportunities and meet the needs of this market as their dining choices shift from fast food establishments to full-service dining experiences in a well-designed, comfortable, clean and guest-oriented atmosphere.”

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The company has engaged Abacus Capital & Investment Corporation, China Bank Capital Corporation, and PNB Capital and Investment Corporation as joint issue managers, joint lead underwriters, and joint bookrunners for the offer.

 

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Paul John Caña
Associate Editor, Esquire Philippines
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