Brimstone Investment Corporation, an empowerment investment company which has its biggest investments in Life Healthcare and fishing conglomerate, Oceana, has sold its 15% stake in Taste Holdings, a franchise specialist which holds the local rights for Domino’s Pizza and Starbucks. The value of Brimstone’s stake in Taste was about R150 million. Brimstone bought 12.4% of Taste in 2012 at 154c per share. It is unclear whether Brimstone exited with a meaningful profit.
While Brimstone's reasons have not yet been made clear, speculation is that the company may have reconsidered the Taste investment after it became apparent it might take longer than expected to unlock value from some of its big brands. The costs of rolling out recently acquired brands like Domino's Pizza and Starbucks were apparent in Taste's results to end-February, which showed a major drop in earnings.
This is the second small-cap investment that Brimstone has sold recently. Earlier this year, in April, the firm sold its stake in fashion retailer Rex Trueform, and holding company African & Overseas Enterprises. Brimstone
- Stay connected, up to date and in the loop on what is happening in the world of finance and keep track of newly published expert insights and interviews with CFOs and CEOs. Become an online member and receive our newsletter, follow us on Twitter, like us on Facebook and join us on LinkedIn.
