Durban – Grand Parade Investment (GPI) has sold Burger King South Africa (BKSA) and Grand Foods Meat Plant (GFMP) to Emerging Capital Partners (ECP) for less than it initially wanted as a result of the Covid-19 pandemic.
GPI said on Wednesday that it had to reconsider its asking price after the transaction was nearly sunk by the pandemic.
GPI had initially agreed to sell both entities for R670million for BKSA and GFMP for R27million when the two parties negotiated in February.
Chief executive Mohsin Tajbhai said the coronavirus pandemic hit the group’s earnings more than 250% during the year to end June.
Tajbhai said the decline of its profits necessitated the review of the planned transactions.
“The deal has been negotiated on a cash basis with no earnings warranty,” Tajbhai said.
“Management is in the process of negotiating a share purchase agreement after which a circular detailing terms of the BKSA sale will be released and a general meeting of GPI shareholders convened to approve the transaction.”
GPI rose 2.94% on the JSE yesterday to close at R2.10.