Famous Brands this morning in which they say that they have finally entered the chicken market

Famous Brands this morning in which they say that they have finally entered the chicken market. Sounds interesting of course, read on. Chief Kevin Hedderwick is quoted in the SENS as saying "Filling the gap in our brand portfolio with a mainstream chicken offering has been a major priority for the Group over many years." Many would agree, you have fish, burgers, pizzas and coffees and breakfast delights, but never any chicken.



Hedderwick continues: "...however, the barriers to entry in this category are high and the market is one dominated by three major existing players, two of which compete in the deep fried category, and the other flame grilled." KFC and Chicken Licken in the deep fired category and Nando's obviously in the flame grilled. So it makes sense then to enter into the flame grilled segment then? Exactly.



The purchase is small by their standards, but is the second of its kind, enter into small businesses that seem to be making headway and take a controlling stake. The recent one was Tasha's. A much bigger one included the South African purchase of the Mugg & Bean. But this one is small by comparison, only three stores of a brand called Giramundo a flame grilled chicken. Shops in Thembisa, Alexandra and Soweto. The brand was founded in 2007. Owner managed by a couple seemingly, who thought that Portuguese flame grilled chicken would be a good idea. Got that, is a good idea, Nandos know that already.



"Famous Brands will invest R1.2 million in the business to re-engineer and enhance the existing intellectual property and cover operational costs for the first two years." in return for a 51 percent stake. Two new stores being opened in Kokstad and Nelspruit. First read through I thought hmm... this sounds strangely familiar, sounds like Nandos. The guys at Famous Brands are way smart and have a good track record. We should back them on this seemingly odd purchase.




When folks talk about the last investment frontier, are they referring to the moon, Mars with its iron ore potential, but rather to Africa, the continent. Watch this continent, which folks tend to group as one. There are a few more states than the entire USA has, but they are wildly divergent. Somalia is not South Africa. Guinea-Bissau is no Ghana. So I am always careful when referring to the continent as an investment destination, choose your spots carefully. But I was interested to stumble across this article: Next to watch: emerging African consumers.



I think that the advice to give to outsiders is simple, buy companies in your market that you understand, that do business in the regions. So if you live in Europe then pick companies you know that do business there, say for instance like Tullow Oil. In our case, pick stocks like MTN, Massmart and Shoprite Checkers. There are plenty of locally listed companies that are looking to expand their African footprint.