Taste Holdings has announced that it has placed its food business into voluntary liquidation after it failed to find a willing buyer for its franchising business, Domino’s Pizza.
Taste Holdings CEO Duncan Crosson said the move affects 770 employees and the 55 Taste Holdings corporate stores have closed effective immediately.
“The liquidation decision comes despite the group’s extensive international efforts to sell its licensing agreement for the global pizza brand with the affected companies being Taste Food Franchising, Taste Commissary and Taste Food Trading,” Crosson said.
“The major creditors include Taste Holdings who had provided the funding, employees, Domino’s Pizza LLC, landlords and the supply chain creditors.”
The introduction of Domino’s Pizza to the South African market in October 2014 broke several sales records in the first full week of trade, with sales at the first four stores more than exceeding expectations.
However, the business has since run into problems as slow economic growth, subdued consumer spending hurt its margins and profitability.
Taste announced its revised strategy and decision to exit the food business in November, Domino’s Pizza loaned the group operating capital while management and Domino’s Pizza sought a prospective buyer for the franchising licence.
However, discussions with three master franchise partners, as well as various global suitors, finally collapsed this week, triggering the voluntary liquidation decision
Crosson confirmed the liquidations were not expected to affect Taste’s remaining business as management focused on the Luxury Division driven by the brands NWJ, Arthur Kaplan and World’s Finest Watches.
By Kabelo Khumalo
