Spur to buy Doppio Zero

Spur announced today that it is set to acquire a 60% interest in the restaurant brands Doppio Zero, Piza e Vino, and Modern Tailors. 

This acquisition includes a portfolio of 37 franchised and company-owned restaurants and Doppio’s bakery and central supply business.

Spur did not specify the purchasing price. However, it said the purchase consideration falls below the threshold of a categorised transaction in terms of the Listings Requirements of the JSE.

The lower threshold for a categorised transaction is equal to or less than 10% of the issuer’s market capitalisation.

Therefore, based on Spur’s R2.15 billion market cap, the value of the transaction should be lower than R215 million.

The interest in the Doppio Group is being acquired from founders and shareholders Paul Christie and Miki Milovanovic.

This acquisition aligned with Spur’s strategy to expand into categories, markets and channels where it is not fully represented. 

The company’s speciality dining portfolio currently comprises 40 restaurants across The Hussar Grill, Nikos and Casa Bella brands, with dinner trade representing about 71% of speciality turnover. 

The Doppio Group will nearly double Spur’s speciality portfolio and enable the group to increase its share of the speciality daytime dining market substantially.

Doppio Zero’s will position Spur in the bakery and coffee speciality market and allow the company to offer a “bespoke day and evening dining experience”. 

“As the Doppio Group operates predominantly in Gauteng, with only 4 of the restaurants located outside the province, the transaction creates an opportunity for the group’s franchisees to invest and expand their brand portfolios nationally, particularly with Doppio Zero, which is the most established of the brands,” said Spur.

The Doppio Group’s bakery also provides supply chain opportunities to the company.

The first Doppio Zero opened as a bakery and café in Greenside, Johannesburg, in 2002. The offering expanded from an artisanal and exclusive bakery into a full-service restaurant, offering Mediterranean specialities and traditional Italian fare. 

The Doppio Group generated sales of over R600 million in the financial year that ended 28 February 2023. 

A total of 669 employees will be transferred from the Doppio Group, with 14% being support staff and bakery employees. The remaining staff are employed at the company-owned restaurants. 

The founders will continue as executives of the Doppio Group for at least five years.

“Following operational and business due diligence, supported by valuations by management and independently assessed by an external corporate finance institution, the group has concluded heads of agreement with the Founders,” Spur said. 

The transaction’s effective date is expected to be 1 September 2023, following fulfilment of all conditions precedent and notification to the Competition Commission.

Piza e Vino, a pizzeria with café-style dining and al fresco seating, will add to Spur’s existing Italian offering provided by Panarottis (78 restaurants) and Casa Bella (6 restaurants).

The most recent addition to the brand portfolio is the Modern Tailors restaurant, inspired by Indian cuisine.