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Former Steers operator now placed under receivership

BUSINESS
By Rawlings Otini | March 18th 2020

Hoggers Ltd Chairman Nurdin Ajania (right) and cashier Monica Wanjiku talk to customers after opening Debonairs Pizza and Steers outlets on Ngong Road, Nairobi in 2015. [File, Standard]

Hoggers Ltd, a franchise that operated outlets under the South African fast-food brands Steers and Debonairs Pizza as well as Ocean Basket in Kenya, has gone under receivership.

This comes after South African franchisor, Famous Brands, took direct control of over seven outlets in Nairobi from Hoggers last November.

“Notice is given that Owen Koimburi has been appointed as the administrator of Hoggers Ltd,” read the Gazette notice dated March 13, 2020.

Famous Brands now runs Steers and Debonairs Pizza through its local subsidiary FB Franchising Kenya.

The High Court had also issued a moratorium for 12 months from February, staying any resolution for the liquidation of the company, enforcement of security over the company’s property, and repossession of goods in the company’s possession under a credit purchase transaction.

All legal proceedings against the company or the company’s property before other courts, tribunals and quasi-judicial bodies have also been put on hold.

Steers has been operating on a mix of company-owned and franchise partners in Kenya — where third parties buy rights to operate a Steers store from Hoggers.

The value of the buyout by Famous Brands from Hoggers was not disclosed. However, Hoggers woes started in 2017 after Steers closed two of its Nairobi city centre branches. These were its Wabera Street and Kenyatta Avenue branches.

The then shareholder and managing director of Hoggers Ltd Azam Samanani said it was a change of business strategy, but the competition was evident.

A Gazette notice, published on August 23, indicated that the outlets were up for takeover by Famous Brands within Nairobi, with some located in Donholm, Ngong Road, South C and Kiambu Road.

There has been increased investor activity in the food industry in the past five years, with local and global franchises stepping up competition for old brands.

Big Square, Beirut, Kilimanjaro, Chicken Inn, Java House and American chains Hardee’s, Burger King and KFC, Art Café have all opened outlets in Nairobi. They plan to set up additional branches in the capital city and other urban centres.

Famous Brands’ decision to control its local business comes a year after another South Africa-based Mr Price Group reclaimed its franchise from fashion apparel retailer Deacons East Africa.

Receiver managers are on a roll as more companies struggle due to tough business environment that has seen some large firms fold.

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