Balai Enters $6-B Baked Goods Segment

Fruitas Holdings (FRUIT), which acquired some of the Balai Pandesal company's assets last year, successfully launched its subsidiary Balai ni Fruitas (BALAI) on the Philippine stock market last June 30.

Photo Insert: BALAI intends to increase its Balai Pandesal retail network to 130 by 2023 and 200 by 2026.

The new company will explore the huge potential within the Philippines' more than USD6 billion baked goods segment. Fruitas' goal of being a ubiquitous food and beverage company with increasing market penetration and scalability is being pursued through this BALAI IPO.

“The listing opens more opportunities for us to be nimble and respond to our customers’ evolving preferences. The IPO proceeds and the Company’s strong cash generation from our operations will allow us to aggressively grow our business,” Balai ni Fruitas Inc. President and CEO Lester Yu said.

BALAI received approximately P203.8 million in net primary proceeds from the IPO, and FRUIT received a minimum of P35 million in gross proceeds, with more proceeds possibly coming after the price stabilization period.

FRUIT anticipates recording a one-time gain on the sale of its current Balai ni Fruitas shares, further increasing its equity in the subsidiary. In fact, the recent purchase of "Ling Nam Wanton Parlor and Noodle Factory since 1950" is one of the new strategic initiatives that will be funded with proceeds from sale of shares.

The Balai Pandesal brand has been aggressively expanded by the Company, from 5 outlets at the time of acquisition to 38 stores by June 2022.

In June 2022, the Company inaugurated three new Balai Pandesal outlets in Metro Manila, including a community store in Barangay Fairview Park, the first Balai Pandesal local bakery in Barangay Krus na Ligas, and the first Balai Pandesal kiosk in Ayala Malls Cloverleaf.

BALAI intends to increase its Balai Pandesal retail network to 130 by 2023 and 200 by 2026. BALAI Pandesal goods are also available in 54 FRUIT retailers, including several of the company's other community stores.

The company also intends to further acquire or offer value-added innovations that would complement its baked goods portfolio.

FRUIT intends to emulate the organic growth it has achieved with prior minor acquisitions such as de Original Jamaican Pattie, Sabroso Lechon, and The Tofu Store (re-branded as Soy & Bean) and successfully incorporate them into its ecosystem.

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