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THE
country’s second-largest fastfood brand, McDonald’s, is
shelving its plans to go public due to weak market
conditions.
In an
interview, George Yang, founder and chairman of Golden
Arches Development Corp. (GADC), said the company is
temporarily deferring the plan until the general market
sentiment improves.
“We will
still consider it when the right timing is there,” he
said.
Golden
Arches was originally planning to go public by the
second half of 2007. Ernst & Young was tapped as its
financial adviser.
The
company had started discussions with prospective
underwriters for the planned initial public offering
although it had yet to announce how much it hopes to get
from the IPO.
“McDonald’s Philippines, with its impressive performance
during the last three years and with the current strong
performance of the local capital markets, believes that
going public [in 2007] would further underpin its
aggressive growth strategy,” Golden Arches said earlier.
GADC is
the local franchisee of McDonald’s. The company has been
under the control of Yang until March 2005, when
Alliance Global Group Inc. bought 49 percent of GADC
from McDonald’s Restaurant Operations Inc., a subsidiary
of McDonald’s Corp., both foreign corporations
incorporated in the US. The balance of 51 percent is
still with the Yang family.
McDonald’s is the closest rival of Jollibee in the
quick-service restaurant segment.
In the
first quarter, its revenues grew 6 percent to P1.9
billion from the effects of its store chain expansion.
However, net profit declined to P16.5 million, down 73
percent year on year. The company-operated stores
numbered 171 at end of March from 153 a year ago. Six
new stores were opened last quarter.
At the
end of March, McDonald’s stores totaled 277 nationwide
compared to 259 a year ago. Twenty four new outlets will
be opened in the remaining months of the year. |
