17
Jul
09

Arab Investments in exclusive talks to buy Coffee Republic

arabinvestments

The property company behind plans for one of London’s tallest skyscrapers has emerged as the surprise potential buyer of Coffee Republic.

Arab Investments, a private property investment company best known for its proposed Pinnacle tower in the City of London, on Friday entered into an exclusivity agreement with KPMG, which is acting as administrator to the coffee shop chain.

If successful, Arab Investments intends to put money into developing the Coffee Republic brand in the UK and overseas, and will start expanding the branch network immediately after completing the deal. It is thought to be in talks to acquire about 80 outlets, of which 20 are outside the UK, in countries such as Saudi Arabia and Bulgaria.

Arab Investments is thought to see the chain as having a strong brand name, which can be grown to challenge larger chains such as Starbucks and Costa. The deal is thought to be largely opportunistic, with the owners of Arab Investments seeing the chance to buy a large chain of leasehold outlets at a cheap price. No financial details of the transaction were provided.

KPMG confirmed that it had granted a period of exclusivity to the preferred purchaser of Coffee Republic, but declined to comment on the identity of the buyer.

Joint administrator Richard Hill said: “As expected, the huge volume of enquiries from interested parties produced a very healthy level of offers. We have spent the last few days clarifying the terms of the most attractive offers and we have now identified our preferred purchaser.

“We have agreed a period of exclusivity to allow that party to carry out some limited due diligence, which should enable us to agree the terms of the sale of the residual business as a going concern during the course of next week.”

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1 Response to “Arab Investments in exclusive talks to buy Coffee Republic”


  1. 1 Les Stewart
    July 21, 2009 at 4:03 pm

    While it may seem prudent to keep your head low during these times, I would encourage each investor to understand their situation.

    I would suggest searching for the coffee system called “Country Style Donuts” on WikidFranchise.org and reading Prof. Buchan’s excellent paper called “When the Franchisor Fails” http://www.cpaaustralia.com.au/cps/rde/xbcr/SID-3F57FECA-D61C7C37/cpa/200602_franchisor.pdf

    Administrations can be a very, very difficult time for franchisees.

    And as bad as the old boss was…you’d be surprised how less predatory they can be seen, in hindsight.

    If any of you have BERR guaranteed loans, I would suggest you reading my 2005 paper called “Franchising Opportunism: Deceit to Secresy Confind” (http://www.wikidfranchise.org/franchising-opportunism)

    I suggest that franchising has evolved into an extremely sophisticated engineered process that is designed to re-allocate (not produce) wealth. I take the role of the medieval jester deadly seriously because I have witnessed dozens and dozens of families ruined. I would hope that there are some UK peers with a similar twisted attitude.

    Take care out there.

    Mr. Les Stewart MBA
    les.j.stewart@gmail.com
    FranchiseFool, editor http://lesstewart.wordpress.com
    WikidFranchise.org, co-editor

    Personal background: http://lesstewart.wordpress.com/2008/05/17/the-apprenticeship-of-les-stewart/


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