The world's second largest fast food hamburger chain, Burger King, has announced a joint venture (JV) agreement with Grand Parade Investments (GPI) to launch the franchise in South Africa. The opening of the first restaurant in the innovative new global design is planned for Cape Town in 2013.
The JV is subject to regulatory approval in South Africa and is expected to close before the end of the year. According to GPI, its exclusive rights and national rollout will enable the business to become a major presence and employer in South Africa. The aggressive growth plans are expected to contribute significantly to the South African economy and create a number of jobs for South Africans over the next five years and beyond.
Founded in 1954, the system operates in over 12 600 locations serving over 11 million guests daily in 83 countries and territories worldwide. Approximately 95% of its restaurants are owned and operated by independent franchisees, many of them family-owned operations that have been in business for decades. In 2012, the group successfully introduced similar joint ventures in Russia and China and in 2011, in Brazil - all focused on increasing market share in the fastest-growing economies worldwide.
"We are thrilled to announce the continued expansion of the brand with this JV," says José Cil, president, EMEA, BKW. "We have closely studied the region with GPI and believe that now is the time to develop the brand in South Africa. Today's announcement is an example of our company's strategy to accelerate international expansion by creating master franchise agreements with strong local partners in high-growth emerging markets."
"Hassen Adams and the management team at GPI have an excellent operational and sales record demonstrating strong growth and solid sales performance in its leisure portfolio over the last couple of years. We look forward to significantly expanding the scope of its portfolio with its first QSR (quick service restaurant) investment," he concludes.
"The company is perfectly positioned and poised to enter the QSR market with a significant number of restaurants planned over the next few years," said Hassen Adams, chairman of GPI. "Our experience and our successful track record in our outlet driven business will add substantial value to the newly acquired master franchise rights."
Mayor of Cape Town, Patricia de Lille added, "The City of Cape Town works hard to create a prosperous city that enjoys economic growth and development and job creation. Foreign direct investment that boosts our city and our country is warmly welcomed. We are honoured to welcome the global giant to Cape Town and South Africa. The City of Cape Town congratulates GPI on its JV and its efforts in bringing this high quality global brand to South Africa."
GPI was selected for a combination of key factors including its financial resources, industry-leading operational knowhow in the hospitality sector and expertise in running outlet driven businesses. Since its foundation in 1997, GPI has reported strong growth and solid revenue performance across its portfolio of investments.