SUR
SUR
SUR - Spur Corporation - Acquisition of DoRego`s fast food restaurant chain -
Voluntary announcement
Spur Corporation Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/000828/06)
Share code: SUR
ISIN: ZAE000022653
("Spur Corporation" or "the group")
ACQUISITION OF DOREGO`S FAST FOOD RESTAURANT CHAIN
Spur Corporation is pleased to announce that it has concluded agreements in
terms of which it will acquire the fast food restaurant chain, DoRego`s, for R30
million (plus the value of inventory on the effective date) in cash ("the
acquisition").
In terms of the acquisition, Spur Corporation will acquire the DoRego`s
franchise company and the distribution centre operations (including inventory)
located in Bloemfontein.
DoRego`s is a value oriented take-away chain offering a combination of chicken,
seafood and burgers to consumers. The chain has 75 outlets, with a strong
presence in the Free State, Gauteng and Eastern Cape. Stores are mainly located
in regional shopping centres and areas close to busy commuter transport hubs.
Spur Corporation managing director, Pierre van Tonder, said: "The acquisition of
DoRego`s will give Spur Corporation exposure to growth opportunities in the
lower to middle income market, an area of significant expansion in the current
quick service restaurant market place. DoRego`s has a strong brand with solid
growth potential in South Africa. We plan to expand the business into a national
chain by capitalising on the current brand awareness and extending the footprint
into areas such as the Western Cape, KwaZulu-Natal and Mpumalanga."
"There is no overlap with the existing brands in the Spur portfolio. Our
expertise lies in managing franchise restaurant operations. We are planning a
phased transition with the current owners to ensure we benefit from their
expertise in operating quick service outlets and their knowledge of the brand
and target market."
The first DoRego`s store was opened in the 1970s and the present owners, Gerald
and Cedric Brown, bought the franchise company in 2005. In six years the
business has grown from 29 to 75 outlets, serving over 5.2 million customers
annually.
The effective date of the acquisition is expected to be 1 March 2012.
The acquisition is smaller than a category 2 transaction for Spur Corporation in
terms of the Listings Requirements of the JSE Limited.
Cape Town
5 December 2011
Sponsor
Sasfin Capital
A division of Sasfin Bank Limited
Date: 05/12/2011 12:00:01 Produced by the JSE SENS Department.
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