Famous Brands buys 51% of Botswana partner
South Africa’s biggest fast-food restaurant chain Famous Brands will take a 51 percent stake in its Botswana franchise partner, it said on Tuesday, ahead of a potential broader foray in the rest of Africa.
Retail Group, Famous Brands’ Botswana’s master licence partner, runs 28 restaurants that include pizza, burgers and ice-cream in the diamond-rich southern African country.
Financial details of the deal were not disclosed.
Famous Brands, which operates in several African countries such as Nigeria, Zambia and Kenya, makes less than 10 percent of its R3.3 billion ($271.95 million) in annual sales in the rest of Africa.
“We have ambitious and deliberate plans to grow our business outside of South Africa, and we foresee our operations in the rest of Africa becoming increasingly significant to the Group over time,” Famous Brands Chief Executive Kevin Hedderwick said.
Africa’s consumption prospects have been in the limelight since at least 2010 after Wal-Mart Stores announced a $2.4-billion acquisition of South Africa’s Massmart, a deal that gave the world’s No.1 retailer a foothold in several markets on the continent.
At one level, Africa’s pool of consumers with disposable income is expanding thanks to a decade of relative political stability and economic growth.
But some businesses are struggling to cash in, calling into question the arguments and data put forward by cheerleaders of a new, rising Africa ready to rival Asia for consumer-facing industries.
Nestle is cutting 15 percent of its staff in several central African countries including Kenya and Angola, citing stalling growth in the region’s middle class. Source: IOL