Taste halts sale of luxury business
By Loni Prinsloo - Jul 20th 2017, 09:41
Taste Holdings has suspended the auction of its jewellery and high-end watch business after failing to find a buyer willing to pay an asking price of as much as R400m, according to two people familiar with the matter.
Taste said in April that it planned to fully focus on expanding its food unit, which includes the local franchises for US brands Starbucks and Domino’s Pizza. The luxury goods division would therefore be sold, the company said at the time.
Selling the owner of the Arthur Kaplan and World’s Finest Watches chains remained the long-term strategy, said the sources, who asked not to be identified because the process is private. However, if a sale could not be done, Taste would need to find an alternative source for funds to pay down debt and roll out its major US food brands, they said.
The company has already raised as much as R120m this year from the issue of new stock to investors.
"Taste cannot comment on market speculation," spokesman Mike Caminsky said in response to questions.
Taste would focus on the unprofitable food division because of its "hugely attractive" five-year potential, CEO Carlo Gonzaga said in the full-year earnings statement. The luxury goods division reported operating profit of R52.7m in the year to February, while food made a loss of R90.1m. © BusinessLIVE MMXVII
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