Duyuru • May 12
ECP Africa Fund IV a fund managed by Emerging Capital Partners LP completed the acquisition of Burger King South Africa and Grand Foods Meat Plant from Grand Parade Investments Limited (JSE:GPL).
ECP Africa Fund IV a fund managed by Emerging Capital Partners LP entered into a binding offer to acquire Burger King South Africa and Grand Foods Meat Plant from Grand Parade Investments Limited (JSE:GPL) for ZAR 514.20 million on February 19, 2020. As per deal, ECP Africa Fund IV will acquire 95.36% of the issued share capital in Burger King South Africa for the equity value of Burger King South Africa multiplied by 95.36%. Equity value is based on an enterprise value of ZAR 670 million, being an eight times multiplication of the normalized EBITDA of BKSA for the 12 months ending June 30, 2019, of at least ZAR 84 million. ECP Africa Fund IV will acquire Grand Foods Meat Plant for an equity value of plant based on an enterprise value of ZAR 27 million, which in turn equates to a three times multiplication of the normalized EBITDA of the plant for the 12 months ending June 30, 2019, of at least ZAR 9 million. As of July 29, 2020, the purchase consideration for Burger King South Africa would be based on revised enterprise value of ZAR 570 million and Grand Foods Meat Plant would be based on revised enterprise value of ZAR 27 million.
Transaction is subject to the execution by relevant key persons of new employment agreements, the receipt of all requisite corporate, shareholder, third party, franchisor, government and regulatory approvals as agreed between the parties including any necessary approvals from the JSE Limited and the South African competition authorities. Grand Parade Investments Limited Board recommended the offer from Emerging Capital Partners LP. Grand Parade Investments Limited will use the proceeds of the Burger King South Africa sale to pay a special dividend to shareholders. As of December 2, 2020, the transaction has been extended to December 18, 2020. As of December 24, 2020, the date for the conclusion of the share purchase agreement has expired. As of August 18, 2021 competition Commission chief legal counsel Bukhosibakhe Majenge, during a hearing held by the Competition Tribunal and led by tribunal chairperson Mondo Mazwai, said the commission endorses the proposed acquisition of Burger King South Africa by private equity fund ECP Africa Fund based on the amended conditions set out by the parties to the transaction. The parties are however considering a formal extension of the offer while urgently negotiating the share purchase agreement. The Competition Commission has recommended that the sale of Grand Parade's Burger King be prohibited. on June 1, 2021, The Competition Commission has blocked the proposed acquisition. As of June 21, 2021, Grand Parade Investments Limited announce that the shareholders are advised that the dates for fulfilment or waiver of the conditions, have been extended to 19 July 2021. As of July 20, 2021, Grand Parade Investments Limited announce that Shareholders are hereby advised that the parties to the Disposal are still actively engaging the Competition Commission. As a result of which, shareholders are advised that the dates for fulfilment or waiver of the conditions, have been further extended to 20 September 2021. As of September 17, 2021, the transaction has received approval from Competition Tribunal, subject to the following conditions; Burger King South Africa (RF) Proprietary Limited (BKSA) shall within 5 years of the effective date of the disposal – procure the investment of no less than R500 million (five hundred million rand) in aggregate capital expenditure; establish at least 60 new Burger King outlets in South Africa (thereby increasing the total number of Burger King outlets in South Africa to at least 150); increase the number of permanent BKSA employees in South Africa by at least 1250 historically disadvantaged persons as defined in sections 3 (2) (a) to (e) of the Competition Act, 89 of 1998, as amended; increase the total value of all payroll and employee benefits in respect of the 1250 BKSA employees referred to above by not less than R120 million (one hundred and twenty million rand); and improve its rating for the Enterprise and Supplier Development element under its B-BBEE scorecard. Additional merger conditions require that BKSA shall establish an employee share ownership program for an effective 5% interest in BKSA; ECP Africa Fund shall dispose of Grand Foods Meat Plant; and BKSA shall conclude a supply agreement with Grand Foods Meat Plant and/or the purchaser of Grand Foods Meat Plant. Shareholders are furthermore advised that the date for fulfilment or waiver of the conditions, as set out in paragraphs 2.5.1, 2.5.2 and 2.5.3 of the circular issued on 12 March 2021, (conditions precedent) has been further extended to October 4, 2021 in order to fulfil or waive the remaining conditions precedent. As on October 5, 2021, fulfilment or waiver of the outstanding conditions precedent has been extended to October 11, 2021 in order to fulfil or waive the remaining Conditions Precedent. Cliffe Dekker Hofmeyr acted as legal adviser and PSG Capital (Pty) Limited acted as Sponsor and Corporate Adviser. Marc Yudaken of Baker & McKenzie South Africa acted as legal advisor to Emerging Capital Partners.
ECP Africa Fund IV a fund managed by Emerging Capital Partners LP completed the acquisition of Burger King South Africa and Grand Foods Meat Plant from Grand Parade Investments Limited (JSE:GPL) for ZAR 514.20 million on May 10, 2022. As of May 10, 2022, the considerations have been agreed as ZAR 494 million for Burger King South Africa and ZAR 20.22 million for Grand Foods Meat Plant. Rand Merchant Bank acted as financial advisor in the deal.