BREAKING: Shakey's Gobbles Up Potato Corner
Christmas came a couple of days early for two of the country’s biggest food businesses. On Friday (December 24), listed Shakey’s Pizza Asia Ventures Inc. (PSE: PIZZA) announced that it is acquiring food kiosk brand Potato Corner in an asset purchase agreement (APA) signed on Thursday (December 23).
The cost of the acquisition was not immediately made public.
Under the APA, Shakey’s will purchase all the assets and intellectual property related to the Potato Corner business. Shakey’s will also end up owning and operating all company-owned stores as well as serve as brand owner and franchisor of licensed or franchised stores in the Philippines and abroad.
“Potato Corner is a bankable addition to PIZZA’s roster of WOW brands,” said Vicente Gregorio, president and CEO of PIZZA. “Its co-founder, Jose Magsaysay, has truly established a solid brand foundation with a product that universally resonates with consumers. The current scale of Potato Corner and the brand love that it receives from consumers are a testament to that. We, at PIZZA, are grateful that Potato Corner’s former owners are entrusting the brand to our team. We look forward to continuing on its legacy and strengthening the Potato Corner brand even more.”
Gregorio added that it is an “accretive acquisition,” which means Shakey’s expects its earnings per share to increase following the sale.
“Nonetheless, we will pursue maximizing synergies and wielding our expertise in business development, franchise management, and supply chain operations to further grow the brand sustainably,” he said.
Established in 1992 by Magsaysay and his partners as a food kiosk that sells flavored French fries, Potato Corner is now a global brand, with a total of over 1,000 outlets. About 70 percent of its stores are franchised, with the remaining all company-owned. In the news release announcing the transaction, Shakey’s said the business “has built a strong brand equity and demonstrated robust performance, attractive margins, and the capability to scale, which are all aligned with PIZZA’s criteria for acquisitions.”
“In addition, PC will allow us to cultivate entrepreneurship as one of our advocacies,” said Christopher Po, PIZZA chairman. “Potato Corner has over 600 MSME franchisees. We intend to work closely with them towards making their business successful. As we grow Potato Corner’s business, the more we promote entrepreneurship.”
Shakey’s said Potato Corner faced challenges over the past year and was not spared the effects of the pandemic. It has, however, “demonstrated resilience” and posted “profitable returns.”
“I am excited by the attractive business prospects of Potato Corner. I believe the Shakey’s Management team has the capabilities needed for Potato Corner to prosper and grow,” Po continued.
Formerly known as International Family Food Services Inc and incorporated in 1974, Shakey’s Pizza Ventures Inc. currently has about 171 company-owned and 136 franchised stores of its flagship Shakey’s restaurant. It also owns the Peri-Peri Charcoal Chicken restaurant concept, and is the master franchise holder of the Singapore-based R&B milk tea brand, which it brought into the Philippines in 2020.