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Share price: 370c JSE code: GPL

BUY GRAND PA­RADE IN­VEST­MENTS (GPI) IS a long­stand­ing em­pow­er­ment com­pany, and has more cor­po­rate mileage un­der its belt than the two other com­pa­nies cov­ered in this seg­ment. Not only is GPI street­wise, but it has con­sid­er­able fi­nan­cial mus­cle, in the form of a strate­gic hold­ing in Sun In­ter­na­tional’s West­ern Cape as­sets, to un­der­pin its for­ays into the fast food sec­tor.

GPI’s thrust is led by its mas­ter fran­chise agree­ment for the Burger King brand, which, at the time of go­ing to press, had reached 51 stores in the West­ern Cape, Gaut­eng and KwaZulu-Natal. Though the roll-out of Burger King out­lets has been slower than ex­pected, GPI’s de­ter­mi­na­tion to se­cure a fat (and sus­tain­able) mar­gin rather than chas­ing mar­ket share is com­mend­able. More re­cently, GPI se­cured a li­cence for the Dunkin’ Donuts brand, a move that roughly co­in­cided with the res­ig­na­tion of Burger King boss Jaye Sin­clair. Some be­lieve Sin­clair’s de­par­ture may sig­nal a more ag­gres­sive ap­proach to GPI’s fast food roll-out and per­haps a will­ing­ness to work more closely with Spur Cor­po­ra­tion, where the com­pany holds a 10% stake. Reversing GPI’s fast food as­sets in Spur — in ex­change for a big­ger hold­ing in an en­larged restau­rant and fast food con­glom­er­ate — might make sense. GPI, though, would prob­a­bly want to bulk up its fast food of­fer­ing be­fore en­gag­ing with Spur. It might not be far fetched for GPI to look for ac­qui­si­tions of well es­tab­lished fast food brands. Worth a nib­ble.

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