At the beginning of January 2018, US-based private equity firm NRD Capital announced that it had acquired the 45-year-old iconic South African family restaurant chain, Mike’s Kitchen.
According to a statement released at the time, NRD said that this acquisition and entry into South Africa forms part of a long-term strategy.
This would include the acquisition and development of multiple brands in South Africa, and across the African continent more broadly, creating new jobs and business opportunities, through leveraging the power of franchising, it said.
The return of Mike’s Kitchen
Speaking to BusinessTech, Salim Shermohammed, Mike’s Kitchen’s interim CEO and NRD’s representative in Johannesburg said that the US company’s acquisition would see the restaurant return to its former glory.
“Over the past four decades the operation has grown to 67 units, then shrunk down to four and is currently at 17,” he said.
“Our target for 2022 is 47 units. Mike’s Kitchen will continue with an upward trajectory of growth and we are currently getting our house in order.
“Because franchise unit profitability is critical to us, it is essential that we offer all our franchisees the technical, strategic and financial muscle we are known for. If however, our remedial interventions still don’t enjoy the required changes of a profitable unit, we won’t delay the funeral. Franchise unit profitability is critical to us,” he said.
While the brand and slogan (“It’s family time”) will remain, a new corporate identity has been designed with NRD Capital looking to harness elements of the brand’s heritage and a progressive approach to the millennial market.
This will include a new menu which will feature some of the franchises’ firm favourites coupled with newer dishes, Shermohammed said.
NRD Capital has also made no secret of the fact that it plans to acquire other South African brands and possibly bring new international brands to South African shores.
“Our fund invests with small to medium-sized franchisors, infuses capital and applies our operating expertise to grow those brands,” Shermohammed said.
“We look at franchise companies not just as financial investments, but as living entities in which concept-founders, management and franchisees have invested substantial amounts of time and resources. Our goal is to use our operational and financial experience to position high quality brands for accelerated but responsible growth.
“We have a long-term view for South Africa and Africa as a continent, we have plans to invest more and continue to reinvest.
“Our efforts here are cross-generational and we are here to stay,” he said.