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Wed 8th Jun 2016 - Update: Domino's, Giraffe, CocoMaya, Koh Thai Tapas and Clockjack
Domino’s Pizza UK invests £24m to increase stake in three markets: Domino’s Pizza UK has made an investment of £24 million to acquire significant minority interests in Domino’s Iceland, Norway and Sweden and retain existing strong local management. The interest has been acquired from Birgir Bieltvedt, the chairman and founder of Domino’s Iceland, and certain other investors. Following the investment, Domino’s will hold 49% in Iceland and an effective interest of 45% in both the Norwegian and Swedish businesses. Birgir Bieltvedt and the current management team will remain with the business and retain a significant stake in each country. The company stated: “Iceland, Norway, and Sweden have an aggregate population of 15 million with fragmented competition, stable economies, low unemployment and high digital adoption. These markets offer attractive growth prospects for the Domino’s brand. The existing strong management teams will remain in place allowing us to combine their operating strength with our skills in franchising, marketing, e-commerce and supply chain. The combination of proven local management in addition to our expertise and financial strength means we are well positioned to take full advantage of the growth opportunity. Domino’s Iceland was established in 1993 and currently operates 19 stores, generating Ebitda of £3 million in 2015. Iceland has a population of over 300,000 people and is one of the most successful Domino’s operations on a per capita basis of the 81 countries in which the brand operates. Trading in Iceland is strong with sales ahead by nearly 20% over the past year. There is the potential to increase stores by a modest number and continue to drive like-for-like sales. Domino’s Norway was established in 2014 and currently operates ten stores, with the opportunity for significant further roll out. Norway has a population of over five million people, of which around four million live in urban areas. The Norwegian pizza market represents an attractive growth opportunity with considerable scope for further expansion of the network. Domino’s Norway is expected to be profitable in the second half of 2017. Sweden represents a market offering substantial potential for the brand with a population of almost ten million and no major pizza operator with a significant presence. There are currently no Domino’s stores in Sweden but it is anticipated that the first units will open before the year end. The transaction is expected to be earnings enhancing on an underlying basis for the Group in 2017 and subsequent years and realise significant shareholder value over time. We will fund our investment from cash and existing debt facilities. We expect to report the cost of investment in the transaction as part of the Group’s gross assets. We have the right to appoint a director to the boards of Domino’s in Iceland, Norway and Sweden, and have entered into put and call option arrangements, linked to business performance and subject to independent valuation, to acquire the remaining shares exercisable over the outstanding shareholdings between 2020 and 2023.” David Wild, chief executive of Domino’s Pizza Group, said: “We are delighted to be investing in these exciting markets, which hold great potential for the Group. Our skills in e-commerce, marketing and supply chain will complement the excellent local know-how of our partners in Iceland, Norway and Sweden and help to grow the Domino’s brand. This is a great deal for everyone concerned and we look forward to welcoming our new colleagues and customers.” Birgir Bieltvedt, chairman and founder of Domino’s Iceland, said: “The combination of two partners in these markets, with our own unique skills and knowledge, combined with the financial strength which Domino’s Pizza Group brings, will create a strong business in countries with significant potential for future growth. We have a talented and motivated team and are excited to start working alongside our UK partners in further developing the Domino’s brand.”

Sky – Tesco set to sell Giraffe this week: Britain’s biggest retailer Tesco is likely to announce this week a sale of its Turkish unit Kipa and British restaurant chain Giraffe, Sky News has reported. Tesco is selling Kipa to Turkish rival Migros Ticaret, while Giraffe is being sold to an unidentified buyer which already has restaurant assets in Britain, Sky reported, citing sources. Kipa said in May there had been confidential talks between Tesco and Migros but the parties had not been able to reach an agreement. Sky reported in April that Tesco was planning to sell some of its businesses, including Giraffe, to focus on reviving its main grocery business. Tesco, under chief executive Dave Lewis, has been seeking to cut debt and shed its loss-making businesses after its profits were battered by an accounting scandal and British market share losses to rivals. When Lewis took the helm at Tesco in 2014, analysts had speculated the firm’s stake in Giraffe could be sold. In the first large divestment by Lewis, Tesco sold its biggest overseas unit Homeplus last year.

Gail’s Artisan Bakery seeks managing director for sister business CocoMaya: Gail’s Artisan Bakery, backed by Luke Johnson, is seeking a managing director for its sister business CocoMaya. A job advert reads: “We are looking for a professional who believes that the world deserves better food and wants to test their entrepreneurial and leadership skills in an existing business with lots of opportunities in wholesale and retail.” CocoMaya is a ‘boutique coffee, tea and cake bakery’ in Connaught Village, near Marble Arch. The advert adds: “Gail started the business with some friends and our Gail’s head baker Roy helped establish the on-site production. We make and sell beautiful food, coffee and tea (and are back into the chocolate world). Our little corner of London is central and one of the most beautiful neighbourhoods around. We also have a key wholesale activity with different food halls and top-tier restaurants around town.”

Koh Thai Tapas secures eleventh site: Koh Thai Tapas is to open in the Hampshire market town of Romsey, its third location in the county and eleventh in total – it will open in mid-July after a four week refurbishment. The announcement comes within weeks of the acquisition of a site in Winchester. A twelfth site is expected open later in the year. Koh Thai Tapas will replace Berties of Romsey, which has closed after 21 years. “We have long been interested in Romsey. It’s a fantastic addition to the Koh Thai Tapas brand – the town’s demographics and geographic location make it an ideal setting for us,” said Koh Thai Tapas chief executive Andrew Lennox. “We look forward to seeing some familiar faces who have been fans of our Ringwood and Salisbury branches and to becoming a part of the community in Romsey.”

Clockjack to open in Woolwich: The Woolwich Arsenal Estate has announced that Clockjack, the rotisserie and grill restaurant founded in Soho, has secured a second site at 79 Powis Street in Woolwich town centre. Clockjack’s new 1,500 square foot restaurant is due to open in July. The business, founded by former Terra Firma managing director Fraser Duncan and former Centre Parcs Europe chief operating officer Jerry Goldberg, launched a 50-cover restaurant in Soho in 2012, offering herb-marinated, carefully sourced, free-range chicken cooked in a vertical rotisserie oven and served with Clockjack’s own special sauces. As well as the brand’s healthy free-range chicken and extended drinks offer, including Clockjack’s ‘clocktails’, the new 75-cover restaurant in Woolwich will also feature a vertical rotisserie, only the second of its kind in the UK. Adding to the theatre of the open kitchen, a parrilla grill will also be used. Fraser Duncan said: “We aim to create a restaurant in Woolwich that serves the best quality, great value, free-range roast chicken and with a welcoming, sociable atmosphere. We wanted to replicate the success of our restaurant in Soho and Woolwich was the next choice for our second Clockjack restaurant. The town’s growing reputation, high footfall, and an ongoing investment in the area, which includes Crossrail, made this the ideal location for our brand.” The opening news follows the launch of Clockjack’s dedicated kitchen delivery hub, which opened last week near Monument tube station. It is aimed at City workers in London’s Square Mile offering top-quality, free-range chicken also roasted on a rotating spit over an intense flame. Comprising more than 350,000 square foot of retail and leisure space concentrated on Powis Street and Hare Street, the Woolwich Arsenal Estate is in the town centre of Woolwich. In addition to the retail, the Estate includes over 60 apartments totalling in excess of 42,000 square foot. The forthcoming opening of Crossrail is helping to drive Woolwich’s transformation, with the Woolwich Arsenal Estate sitting at the heart of many significant new residential developments that appeal to the large volumes of young, urban consumers moving into the area. Cradick Retail and Nash Bond acted for the Woolwich Arsenal Estate. 

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