SM Group’s property and retailing unit SM Retail Inc. has withdrawn its acquisition bid over bakeshop and restaurant chain Goldilocks Bakeshop Inc. on Thursday, February 1.
“Regarding the proposed acquisition by SM Retail of Goldilocks, both SM and Goldilocks have jointly agreed not to pursue the transaction given changes in the general business environment,” SM said in a statement sent via SMS to Entrepreneur Philippines.
This comes less than a month after the Philippine Competition Commission (PCC) approved the takeover last January 9. The deal required the SM Group to submit reports to the commission over a period of five years to ensure Goldilocks’ competitors will have “a fair shake in their lease at all times.”
The PCC earlier said there may be risks of unfair treatment against Goldilocks Bakeshop’s competitors, which may arise from providing “disadvantageous locations or unfavorable lease terms.” Under the deal, monitoring would also have been done by the PCC to avoid this, which would have included random inspections.
“It’s a completely business decision on their part, we’re happy we went that far and they cooperated (sic). SM presented their undertaking but at the end of the day they decided not to continue their transaction," PCC Chairman Arsenio Balisacan said in a report by ABS-CBN News.
Goldilocks Bakeshop has a total of 159 stores in Metro Manila, 36 of which are located inside an SM mall. In contrast, its closest competitor, Red Ribbon, has 133 stores in NCR—12 of which are tenants of SM.
Goldilocks Bakeshop is owned by the Yee family and was established in 1966. It has maintained a steady financial record over the years, consistently making it to Businessworld’s list of Top 1000 Corporations in the country since 2008. In 2016, it grossed Php6.1 billion in revenues and netted profits of Php204 million, making it the country’s 356th highest earning company.
SM Retail Inc. is a subsidiary of SM Investments Corporation, the country’s largest holding firm. The SM Group is owned by Henry Sy, the country’s richest man, who has a net worth of $21 billion according to Forbes magazine.
Pauline Macaraeg is Entrepreneur PH's data journalist. Follow her on Twitter @paulinemacaraeg