KENYA – The Artcaffe Group, owned by US private equity firm Emerging Capital Partners (ECP) is set to open a new Artcaffe Coffee and Bakery outlet in the country’s capital, Nairobi.
The new outlet to be located in the city centre is set to further consolidate the group’s share in the country’s rapid growing fast food sector ahead of its rivals including Kentucky Fried Chicken (KFC) and Java Coffee House.
ECP re-entered the coffee brewing business last January after the Competition Authority of Kenya (CAK) approved its takeover of the entire business of Artcaffe for US$35million (Sh3.5 billion), reports Business Daily.
This was after the investment group sold its entire stake in casual dining chain Java Coffee to Dubai-based equity firm Abraaj in 2018 for more than US$100 million.
The acquisition gave ECP control over ArtCaffe’s business that consists of bakeries, coffee houses, and eatery brands such as Dormans, Tapas Ceviche Bar, Urban Gourmet and Oh Cha Noodle Bar.
ECP said in a statement said that the takeover will enable it
“There is immense opportunity in eastern Africa for casual dining concepts. Alongside population growth and increased urbanisation, demand for international cuisine and casual, high-quality dining experiences is rising,” ECP said.
Artcaffe first opened shop in Kenya in 2009 and has expanded rapidly with new outlets especially in Nairobi’s high-end shopping malls as well as in Mombasa to the current 26 outlets.
The restaurant chain affirmed its presence in Kenya in 2014 when it acquired Dormans Coffee which granted it an opportunity to sell locally sourced branded coffee, Artcaffe Fairtrade Coffee Blend.
Global and local brands have in the recent past aggressively rolled out expansion strategies aimed at spreading wing into the fast growing economy of the east African region.
Notably, Kuku Foods East Africa Holdings, the owner of KFC franchises in East Africa recently agreed to form a joint venture with Vivo Energy to accelerate the growth of the first food chain in the region.
The 50:50 venture will help the growth of KFC through the opening of new outlets at Vivo’s properties in Kenya, Uganda and Rwanda.
In addition Java House, which is also one of the leading coffee houses in the region, has unveiled plans to invest about US$10 million (Sh 1 billion) across the East African region this year as part of its 2019 strategy to maintain its leading position.
Java leads with 65 outlets across East Africa and has also added its newest brands, Planet Yoghurt and 360 Degrees Pizza.