Finally getting serious
Spur announced that it is taking a 51% stake in RocoMamas for an undisclosed amount, but being such a small deal that is not important. What is important is the deal itself, which saw the Spur share adding over 6% on the day (some R250m to the market cap of the company). With only four stores, RocoMamas is not going to add anywhere near that sort of value to Spur in the next few years, but the market has spotted Spur’s management finally getting serious. I have long criticised Spur for just resting on its success. This deal shows that Spur is finally waking up and going head-to-head with the market leaders (most notably Famous Brands*). The immediate benefit for RocoMamas is that it can plug into Spur’s distribution net work and centralised kitchen. The 51% stake will also keep Spur management on board and focused on growing the business.