Philippine fast food giant Jollibee Foods Corp (JFC) and a unit of US-based food conglomerate Cargill Inc signed a joint venture agreement for the creation of a local processing facility which is expected to create 1,000 full time jobs.
Called the “Cargill Joy Poultry Meats Production Inc”, the new joint venture firm will be developed in Santo Tomas town in the province of Batangas, Philippines.
Jollibee informed the local bourse on Tuesday that it signed the JV with Cargill’s wholly-owned subsidiary Cargill Philippines Inc, wherein Cargill and Jollibee will have a 70 per cent and 30 per cent stake, respectively.
The US agribusiness firm will oversee the setting up, management and operations of the poultry processing plant to be led by its managing director Paul Fullbright.
Jollibee revealed it will invest up to $5.2 million (P244.9 million) for 30 per cent stake in Cargill Joy Poultry Meats Production Inc, and another P15.2 million for a 30 per cent stake in Cargill Joy Poultry Realty Inc, where the new JV firm will lease the land where the plant be located.
However, detailed investment figures from Cargill were not disclosed.
Besides job creation, the new processing facility is expected to provide new opportunities in the farming community in Batangas and nearby provinces as local poultry farmers are contracted to grow chicken to supply the requirements of the processing plant.
Jollibee chief executive officer Ernesto Tanmantiong said they partenered with 150-year-old American firm to deliver high quality chicken products using Cargill’s technology and quality standards.
“The facility will provide JFC with dressed and marinated chicken to augment the chicken supply requirements of the growing needs of JFC brands,” Tanmantiong said. “The patnership will meaningfully benefit our customers, our operations as well as the overall Philippine food industry.”
He added Jollibee will maintain its strong relationship with key chicken suppliers in the Philippines and looks forward to sustained long term arrangements with them as businesses grow.
Meanwhile, Fullbright said Cargill is making additional investments in the Philippines to participate in the robust growth of its consumer sector.
“As in many other parts of the world where we do business, Cargill can also contribute in improving the system of hygiene, food safety, and quality by operating a world class facility and by setting high level of partnership with the poultry growers and farmers,” Fullbright said.
The JFC Group of Companies is one of the largest buyers of chicken in the Philippines. Its brands Jollibee, Mang Inasal, Chowking, Greenwhich, and Burger King franchise sell significant volume of chicken products.
JFC notes it has a broad system of product supply chain that includes 13 commissaries in the Philippines.
The Philippines is Cargill’s first office in Asia which started in 1947 when the vegetable oil division started buying copra for export to the US. Cargill Philippines now employ over 460 people throughout the archipelago.