Dunkin Donuts, Baskin Robbins to close in SA


JSE-listed Grand Parade Investments announced on Friday its exit of poor-performing assets Dunkin Donuts and Baskin Robbins as part of its value-based strategy, which aims at improving the group's capital allocation.
Acting CEO Mohsin Tajbhai said in a statement that the businesses have negatively impacted the group's cash resources.

"Since June 2018 it became apparent that both brands would not meet their original, nor revised forecasts based on the poor performance of existing stores," said Tajbhai.
"We have been actively pursuing opportunities to exit these businesses in the most effective and efficient way since September 2018. We have engaged with several potential buyers over the second half of 2018 and have decided that voluntary liquidation of both businesses is the best possible option in the absence of any serious offers," says Tajbhai.
"While disappointed in our inability to gain traction in SA, Dunkin Brands International is aware of our decision to exit. The liquidation process will be managed in such a way that obligations to landlords and staff can be dealt with responsibly. Of the 120 staff impacted, we will aim to accommodate as many as possible in our other businesses or pay appropriate retrenchment compensation to those who cannot be offered alternative employment."

According to the statement, this process has no bearing on GPI's Burger King franchise, which currently operates 82 stores and are EBITDA positive at group level.

"Nevertheless, we are focusing on optimising the profitability of existing restaurants while ensuring that the new restaurants we are opening are all quality stores," said Tajbhai.
"While the closure of Dunkin Donuts and Baskin Robbins is a disappointment, this is the right decision for all stakeholders and we are now better positioned to focus our efforts on building on the current momentum at Burger King."

According to GPI, the closure of Dunkin Donuts and Baskin Robbins will allow GPI to free up capital which will assist in funding the growth of Burger King.  

"At this stage, we believe that the value of GPI lies in unlocking the potential we see in Burger King," said Tajbhai.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24
Rand - Dollar
Rand - Pound
Rand - Euro
Rand - Aus dollar
Rand - Yen
Brent Crude
Top 40
All Share
Resource 10
Industrial 25
Financial 15
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Voting Booth
Facebook is facing a fresh crisis after a former employee turned whistle-blower leaked internal company research . Do you still use Facebook?
Please select an option Oops! Something went wrong, please try again later.
Yes, the benefits outweigh the risk for me
25% - 230 votes
No, I have deleted it
46% - 426 votes
Yes, but I am considering deleting it
29% - 265 votes