Fin24

Spur acquires DoRego's

2011-12-05 14:13

Johannesburg - Spur Corporation [JSE:SUR] has bought fast food restaurant chain DoRego's for R30m in cash, it said on Monday.

"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," Spur Corporation managing director Pierre van Tonder said in a statement.

DoRego's is a lower to middle market take-away chain offering chicken, seafood and burgers.

It has 75 outlets, mainly in the Free State, Gauteng and Eastern Cape.

Spur Corporation will acquire the DoRego's franchise company and its distribution centre in Bloemfontein. The transaction will probably be effective from March 1 2012.

"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," Van Tonder said.

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, Spur said.