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LONDON (Alliance News) - DP Poland PLC, the Domino's Pizza franchise in Poland, said Tuesday that it has sold and sub-franchised five corporately managed stores in Warsaw.
DP Poland, which has the exclusive right to develop, operate and sub-franchise Domino's Pizza stores in Poland, said that Jakub Stepien, the company's first sub-franchisee, has agreed to acquire and sub-franchise three additional corporately managed stores through an entity called Rush Hour Pizza.
The company said that Jakub has become a shareholder in Rush Hour Pizza and will take on responsibility for driving growth and profitability at that company. It is being backed by Singapore-based investment manager Working Capital Management PTE Ltd.
As part of the transaction with Rush Hour Pizza, DP Poland said it has entered into an agreement with WCM, Rush Hour Pizza's majority shareholder, which gives WCM the right to subscribe for up to 9.99% of the enlarged issued share capital of DP Poland in the event of a future equity fundraise by DP Poland. It said the agreement is for a period of three years.
DP Poland said it has also entered into an agreement with HLM Group to acquire and sub-franchise two of its corporate stores in Warsaw.
DP Poland said the five corporate stores being sold recorded an earnings before interest, taxes, depreciation and amortisation loss of around GBP27,996 for the six months to June 30, and is selling the stores for around GBP575,734. It said that proceeds from the transactions will be settled in cash and used to fund working capital.
The company said it will now have 13 corporate stores in Warsaw and Krakow, and six sub-franchised stores in Warsaw, while its new "well-funded" franchise partners have the potential to open and acquire many more stores in the future, it said.
HLM Group said it plans to "add a number of stores in the future."
DP Poland shares were trading 3.7% higher Tuesday morning at 9.59 pence.
By Rowena Harris-Doughty; rowenaharrisdoughty@alliancenews.com; @rharrisdoughty
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