DOMINO'S PUSHES FURTHER INTO EUROPE WITH GERMAN PIZZA CHAIN ACQUISITION
Written on the 19 October 2017 by David Simmons
AUSTRALIAN pizza chain Domino's (ASX: DMP) continues to push into the European market with the acquisition of German chain Hallo Pizza.
The 32 million euro acquisition ($A48.1million) will expand Domino's store count in Germany from 209 to between 300 and 340.
The cost to integrate the 170 Hallo Pizza stores into Domino's network will bring the net spend on the deal to between $52.6 million and $63.1 million.
Domino's Pizza chief executive Don Meij (pictured) says further expansion is planned in Germany.
"The acquisition of Hallo Pizza strengthens our leading market position and assists Domino's Pizza Deutschland to accelerate towards achieving its target of operating 1000 stores in Germany," says Meij.
Hallo Pizza is the largest independent pizza chain in Germany, and includes a wholly owned procurement and logistics business, Chrisa.
The deal will be funded via a mix of cash and debt, but the company says it is interested in spending more to ensure the German business increases efficiency.
The deal will be completed in early 2018, meaning the transaction will not contribute much to Domino's FY18 underlying earnings.
The German deal follows reports that customers of Domino's Australia had their personal data leaked, prompting personalised emails from scammers.
A number of aggrieved customers complained about the apparent data breach on social media, and said they had received emails addressing them by their first names and mentioning where they live.
Domino's insists there has been no data breach, but the pizza chain is investigating a potential issue with a former supplier.
"We are investigating a potential issue with a former supplier's systems that may have led to a number of customer email addresses, names and store suburbs being accessed," says Domino's in a statement.
"Domino's acted quickly to contain the information when it became aware of the issue and has commenced a detailed review process."
Business News Australia
Author: David Simmons