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Cape Town - Restaurant franchisor Spur Corporation has ended a year-long dispute with its UK-based master franchise partner, Trinity Leisure, according to a press statement issued on Monday.
The dispute - which stifled Spur's UK and Irish expansion plans - was effectively resolved when Spur Corporation UK acquired 100% of the Mohawk Spur in Wandsworth (formerly a franchised restaurant) as well as the lease to the premises for £175 000 (R2.8m).
Spur's latest annual report (to end-June 2007) showed the group held a 30% stake in the Mohawk Spur, which held a carrying value of R367 000.
The deal to acquire 100% ownership now means that all future franchise rights for the UK and Ireland now vest with Spur Corporation UK.
Spur Corporation MD Pierre van Tonder said the group's international strategy would continue to be one of measured expansion in selected markets.
"We now have a sound platform in the UK from which to enhance our business. We believe this investment will be the catalyst for growth."After the opening of Spur Steak & Grill in Belfast a few weeks ago, Spur's restaurant base in the UK has increased to eight outlets.
Van Tonder said a further two or three restaurants would be funded by the South African business over the next 12 to 18 months. "After this time Spur Corporation UK will need to become self-sufficient and source its own financing to fund growth."
No doubt this quote to fuel speculation that Spur Corporation UK could be listed in London in the foreseeable future. Van Tonder told Fin24 that a listing was something that "could happen".
He said the increased presence and awareness of the Spur brand following the opening of two high-profile company-owned restaurants in the greater London area last year had resulted in a marked increase in franchise enquiries.
Van Tonder said the group was currently evaluating sites in Newcastle, Milton Keynes and Cheshire.
Investec stockbroker David Sylvester said Spur's intention to continue building its international empire was understandable. "There's no doubt that the SA market is getting closer to saturation, and expanding offshore offers Spur new opportunities."
Sylvester, though, questioned whether the UK market was culturally the optimum market for Spur to expand its international footprint.
But SA rooted operations like Nando's have overcome initial scepticism to build a lucrative footprint in the UK.
In the year to end-June 2007, international operations (excluding Africa) generated less than R20m of Spur's R215m revenue.
* Hasenfuss owns shares in Spur Corporation.
- Fin24