SOUTH AFRICA – The South African fast-food franchiser of Domino’s Pizza, Taste Holdings, shifting its focus from fast foods to luxury goods is auctioning off the contents of their stores throughout the country.
The decision to auction off the franchise was made after Taste Holdings failed to acquire an investor for the ailing business, reports African News Agency.
Park Village Auctions (PVA) is the company responsible for the upcoming auction which includes the contents of 50 fully fitted stores as well as three food preparation factories, all of which are located throughout the nine provinces of South Africa.
Offers to purchase the contents of the franchise have opened as of Tuesday, July 21 and will end on August 5 at 12 noon.
However, the auction will not be held in the conventional way; rather, bidders will make their offers online. The joint provisional liquidators of Taste Holdings will then review the bids and declare the winning bidder.
According to Andrew Dix-Peek of Park Village Auctions (PVA), all the contents of each pizza outlet are to be sold complete or in a combination of lots.
The three preparation factories that are located in Gauteng and Western Cape provinces are also to be sold in lots or in set combinations.
“The stores fully equipped stand ready to trade, allowing an investor to ‘hit the ground running’ in the current economic climate where food for delivery or collection currently reigns over sit-down meals,” said Dix-Peek in a statement on Tuesday.
In March, Taste Holdings announced its intention to liquidate the subsidiary that holds the licence for Domino’s SA. Due to the voluntary liquidation, the group had written off intercompany loans to the value of R450m (US$26.9m).
Taste has also sold Starbucks’s licence as well as Maxi’s and The Fish & Chip Co after it said in November it was unable to expand its network of chains sufficiently to reach its profit targets.
Management had estimated that it required more than R700m (US$41.9m), including the amount it had raised via a right offer, to achieve a positive cash flow, and expanding the Starbucks network to 150-200 outlets and Domino’s to 220-280.
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