Gold Brands Investments and Circle Food Group conclude R100M BEE transaction
Circle to control 41.02% stake
Ahead of its listing on the JSE AltX, Gold Brands Investments (“GBIL”) announced today that it has concluded a R100-million deal with Circle Food Group.
The date of the listing is yet to be confirmed by the JSE, however, at listing, Circle Food Group will control a 41.02% stake in the fast-growing franchise food business established by Stelio and Praxia Nathanael, which has over 300 stores in its flagship brand, Chesa Nyama. It has four other food brands in its stable.
Circle Food Group’s major shareholder is Circle Capital Ventures (Pty) Ltd, which is a black-owned investment holding company, whose Chairperson is Hlumelo Biko and Chief Executive is Clive Rugara.
It is the private equity arm of Circle Capital Group specialising in expansion capital investments and was established by the Biko and Rugara families in 2002. The private equity firm previously held a portfolio of diversified private equity investments and conducted corporate finance activities, but after selling all its other interests, it now focuses exclusively on the acquisition of assets in the food industry through Circle Food Group.
Says Stelio Nathanael, Chief Operating Officer of Gold Brands Investments and CEO of its subsidiary Chesa Nyama: “We are very excited to welcome on board our new black empowerment partners who will control a significant stake in the business. As a company we have for a long time been focused on creating entrepreneurial opportunities for prospective black business owners. As a result over 85% of our Chesa Nyama franchise owner-operators are previously disadvantaged. We feel this is a very good partnership for us.
“The success of our Chesa Nyama franchise brand has been incredible; growing to over 300 stores in only three years and creating well over 3000 jobs in communities across South Africa. We are positive that with this deal and with the imminent listing that we will continue to expand and create opportunities for more owner-operators across all our food brands.”
The deal allows for the appointment of two non-executive directors to the board of Gold Brands. Hlumelo Biko and Clive Rugara will serve on the board as non-executive directors.
Says Hlumelo Biko, co-founder of Circle Food Group: “We look forward to participating in the continued growth of this well-loved South African brand. That it has been so warmly received by the South African public, goes to show that when a franchise brand has the right product and delivers local favourites that it can experience rapid growth. We are also interested in helping Gold Brands to expand the other brands in its stable, including 1+1 Pizza, Pitaland, Chicken Wild Wings and the iconic Blacksteer."