Philippines-based fast-food chain Jollibee Foods has announced its plan to acquire a majority stake in South Korean coffeeshop operator, Compose Coffee.

The deal, which values the target company at $340m, is part of Jollibee's strategy for global expansion.

Jollibee Foods' wholly-owned unit Jollibee Worldwide will acquire a 70% stake in the privately held Compose Coffee for $238m.

The Titan Fund, in which Jollibee Worldwide holds a majority stake, will acquire an additional 5%, while private equity company Elevation Equity Partners Korea will purchase the remaining 25% interest.

The acquisition of Compose Coffee, which has 2,600 branches in South Korea, is expected to expand Jollibee Foods' global network to 10,000 stores.

More than 65% of these will be located outside the Philippines.

Jollibee highlighted the franchised nature of Compose Coffee's branches, which contributes to the operator's debt-free balance sheet, robust cash returns and healthy profit margins.

The acquisition will boost Jollibee Foods' sales by 2%, increasing the international business' contribution to 41% of its global revenues.

Jollibee Foods stated in its filing to the Philippine Stock Exchange: “This acquisition is aligned with JFC’s commitment to the coffee and tea segment and franchising initiatives.

“This strategic, rapid growth, financially lucrative investment serves as JFC’s gateway in unlocking the fast-growing international value coffee market in South Korea which ranks third globally in terms of coffee consumption per capita.”

Jollibee recently opened a new restaurant venue in Seattle, Washington, marking its third location in Washington State and its 101st in North America.

The new outlet offers the brand’s signature items such as Chickenjoy and Peach Mango Pie.