Shoppers walk past Doppio Zero at Sandton City. Picture: Karen Sandison/African News Agency (ANA)
Spur Corporation is taking a 60% stake in the Doppio Group, owners of the speciality restaurant brands Doppio Zero, a further indication of the recovery of Spur since the lows of the Covid pandemic.
The acquisition, the price of which was not disclosed, did not appear to set the market alight, as Spur’s share price increased only 0.43% to R23.60 on the JSE by late yesterday afternoon. However, it is worth considering the price has already gained more than 70% from the lows it reached during the Covid pandemic in the latter part of 2020.
Also, in the six months to March 31, Spur Corporation increased headline earnings per share a very strong 198.5% to 136.65 cents and it lifted the interim dividend 67% to 82 cents.
The Doppio’s other restaurant brands include Piza e Vino and Modern Tailors, with a portfolio of 37 franchised and company-owned restaurants as well as a bakery and central supply business.
The business is being acquired from founders Paul Christie and Miki Milovanovic who opened the first Doppio Zero in Greenside, Johannesburg, in 2002. In the year to February 2023, Doppio Group generated sales of over R600 million.
Group CEO Val Nichas said the acquisition would strengthen Spur Corporation’s position in the day-time speciality dining segment and accelerate the group’s entry into the speciality coffee market.
“Our strategy is to expand into categories, markets and channels where we are under-represented. Our speciality dining brands currently comprise 40 restaurants across The Hussar Grill, Nikos and Casa Bella, with dinner trade representing about 71% of turnover.
“The attraction of acquiring The Doppio Group is it will nearly double our speciality portfolio and enable our group to substantially increase its share of the speciality dining day-time market,” said Nichas.
Doppio Zero has extensive expertise in the coffee speciality, offering a bakery café experience during the day and more sophisticated dining experience at night.
Doppio, meaning ‘double’ in Italian, represents the double zero (00) grading of the finest milled flour used in pizzas, pasta and confectionery.
Piza e Vino, a pizzeria-based restaurant with café-style dining, complements the group’s Italian offering provided by Panarottis and Casa Bella.
The most recent addition to Doppio’s brand portfolio is the bespoke Modern Tailors restaurant inspired by Indian cuisine.
Doppio Group co-founder Christie said: “We share the ethos of customer hospitality and understand the importance of creating great dining experiences. Our decision to partner with Spur Corporation is strategically aligned to our vision of expanding our bespoke brands to more regions in South Africa and across the continent.”
A total of 669 employees will be transferred from the Doppio Group and the founders will continue as executives for a minimum of five years.
Nichas said the acquisition also presented opportunities for national expansion of the Doppio brands.
“As the Doppio Group’s restaurants are mainly located in Gauteng, this creates an opportunity for existing Spur franchisees to invest and expand their brand portfolios, particularly with Doppio Zero which is the most established of the brands.”
The effective date of the transaction is expected to be September 1 following the completion of all conditions precedent and notification to the Competition Commission.
BUSINESS REPORT