Famous Brands enters into joint venture with Wakaberry™ Frozen Yoghurt Bar Franchise
Famous Brands has acquired a 70% stake in the Wakaberry™ Frozen Yoghurt Bar business, the brand leader in the frozen yoghurt category in South Africa. Established in 2011 in Durban, this first-to-market self-serve frozen yoghurt brand is the brainchild of husband and wife team Ken and Michele Fourie and their business partner, David Clark. The company currently comprises of 33 franchised stores which extend across eight provinces.
The purchase consideration falls below the threshold of a categorised transaction in terms of the Listings Requirements of the JSE Limited and will be settled from cash reserves. The effective date of the transaction is 1 April 2014.
Famous Brands Chief Executive Kevin Hedderwick says, “Over the past two years the food services industry has witnessed the emergence of frozen yoghurt as a robust new category in South Africa. This fast growing global phenomenon with its roots in the USA and Europe, is quickly gaining momentum locally.”
He adds, “Wakaberry™ pioneered this category in South Africa and as a result of its first-to-market self-serve pay per weight system and 100% real yoghurt, has established a remarkable reputation in a short space of time. We are delighted to have the opportunity to participate in this new and rapidly growing food services sector with a partner which has set the benchmark and still has vast expansion potential in this country.”
Hedderwick comments, “There are a number of compelling reasons why we are so excited about this acquisition. Wakaberry™ is best in its class, which aligns with our Group’s brand development growth strategy. In addition, the brand is highly sought after by landlords, and given its low set-up and running costs, is an attractive business proposition for potential franchisees.”
“Furthermore,” he says, “In the short-term we have the ability to significantly ramp up growth of the brand across the South African landscape given our regional structures, thereby rapidly entrenching Wakaberry™’s leadership position in the category. In the longer term, we have the capability to extend the brand into the rest of Africa region, achieving first-mover status, because of our existing structures within these markets.”
“A key factor underpinning this acquisition is the opportunity to fully integrate the Wakaberry™ brand into the Famous Brands business,” he notes.
Hedderwick says, “Wakaberry™ has the potential to become a “Superbrand” in South Africa. Despite comprising only 33 stores at this point, the brand already has in excess of 175 000 Facebook followers, which is astonishing given its very short history and low retail density across South Africa.”
He adds, “Wakaberry™’s popularity is a reflection of the brand’s powerful appeal and relevance amongst its core LSM 8 – 10 consumer base.”
Wakaberry™ co-founder, Michele Fourie, says, “We received offers from a number of potential buyers, but are pleased to have selected Famous Brands as our partner because we recognise the value that the Group can add to our brand.”
“Our strategic intent is to unlock the massive potential of Wakaberry™, bringing our ‘bowls of happiness’ to all corners of South Africa. Famous Brands provides the proven and successful business model to make this a reality for us,” she adds.
It is anticipated that by June 2014, the total network will comprise 40-plus restaurants, with further openings scheduled for the balance of the year.
Hedderwick concludes, “This transaction aligns with the Group’s strategy to leverage our business model by building capability across our brands, logistics and manufacturing operations. The Wakaberry™ acquisition will add capacity to our best-in-class brand portfolio at the front-end of the business, whilst simultaneously adding volumes at the back-end through integration into the supply chain.”