Mike's Kitchen restaurant chain sale marks USA buyer's move into Africa
Emerging global leader in the franchise private equity space, NRD Capital, has moved into Africa with its first purchase on the continent Mike’s Kitchen, a 45-year-old iconic South African family restaurant chain.
Once one of South Africa’s most well-known chains, Mike’s Kitchen has lost ground to some competitors though there are still more than 20 franchised outlets across the country, focused in the north east around Johannesburg and Pretoria, two are in Port Elizabeth on the south coast and one in Cape Town.
USA-based NRD’s entry into South Africa forms part of a long-term strategy across the continent, it said in a statement today.
Over the next five years, NRD plans to acquire and develop multiple brands in South Africa, and across the African continent more broadly, creating new jobs and business opportunities, through leveraging the power of franchising.
NRD believes that “when franchisees and franchisors work together as partners, all parties win”.
No details of the South African deal were revealed but NRD revealed its largest investment to date, valued at $335 million (R4.7 billion), with the purchase of the casual-dining chain Ruby Tuesday Inc with more than 600 restaurants in 41 states, Guam, and internationally.
“Our focus at NRD Capital is to invest in quality brands and provide strategic and operational expertise to create sustainable value,” says Aziz Hashim, Founder and Managing Partner of NRD.
“With well-established brands that can be differentiated from their competitors, we are able to identify significant growth opportunities, while taking a long-term view of investing in people, product, and the customer experience.
Essentially, we acquire equity within both franchise and non-franchise concepts that offer compelling unit economics and solid opportunities for franchisees,” NRD Capital said in a statement.
“NRD Capital is ecstatic about its acquisition of Mike’s Kitchen,” says Salim Shermohammed, Mike’s Kitchen’s Interim CEO and NRD’s representative in Johannesburg.
“Not only because this superb company turned 45 years-old recently, but also because this iconic brand embodies everything that NRD seeks when it invests in companies.
“Mike’s Kitchen has remained dedicated to the brand’s core promises – wholesome high-quality food, professional service and a unique family atmosphere.
“According to the McKinsey Global Institute, consumer spending in Africa is projected to reach $2.1 trillion by 2025,” said Mr. Shermohammed, “and NRD is in Africa for the long haul – to invest and re-invest in solid franchise businesses”.