NAIROBI, KENYA, DECEMBER 19—US-African focused private equity firm-Emerging Capital Partners (ECP)has announced an investment to acquire a substantial majority in Artcaffé Group (Artcaffé), a restaurant and coffeehouse chain that operates fast-casual and casual concepts in Kenya.
Artcaffé’s most prominent chain, Artcaffé Coffee & Bakery, is a full-service bakery, coffee shop, bar and modern casual dining restaurant.
Other concepts include Urban Gourmet Burger, a gourmet burger and sports bar, OhCha Noodle Bar, serving fast and fresh noodle dishes reflective of authentic South East Asian “street food”, Tapas Ceviche Bar, a vibrant restaurant specializing in Spanish dishes and featuring lively happy hours, and the coffee house Dorman’s.
Artcaffé which opened its first café in 2008 now manages 26 stores throughout Nairobi.
It also operates a sophisticated central bakery, kitchen, and logistics center that prepares and distributes artisanal baked goods, food, and drink shipments to its restaurants daily.
The central kitchen is key to the company’s business model, enabling consistent delivery of fresh and high quality products.
Investment in Artcaffé comes after a successful similar investment and exit in Java House Group which it sold its 90 per cent stake to Abraaj Group.
Artcaffé is among Kenya’s leading eateries located mainly in high end malls.
According to ECP, there is immense opportunity in Eastern Africa for casual dining concepts. Alongside population growth and increased urbanization, demand for international cuisine and casual, high-quality dining experiences is rising.
“Artcaffé is an iconic Kenyan brand that has become synonymous with best-in-class service, excellent coffee,food, and baked goods. Kenyan customers are increasingly sophisticated, seeking global trends, and time-constrained, desiring greater convenience. The Artcaffé management team has done a remarkable job creating an exceptional dining experience and we are looking forward to working with them to bring this experience to more customers,” Paul Maasdorp, Managing Director at ECP said.
The move is expected to revamp Artcaffé which is fighting for market with renown local,regional and international brands among them Java, Kaldis, Café’ Bistro and CJ’s Connect.
“We are excited to partner with ECP, one of the most experienced investors in thissector and market. With ECP’s support, we are looking to bring an exceptional dining experience closer to our customers with many more stores and into their homes with an expanded delivery offering and network,” Artcaffé Managing Director Sagi Vaknin said.
Artcaffé first opened its doors in Kenya at the infamous Westgate Mall in June 2008, before expanding in the city. It took over Dormans Coffee in 2014 as it sought a wider presence in the capital while expanding to Mombasa, Kenya’s second largest city.
“The company’s position as a large tax payer, employer and driver of local supply chain growth with a focus on high international standards is expected to continue its positive impact on local economy,” Vaknin added.
Artcaffé stands a growth opportunity seen in Java which has expanded from 15 stores (at the time of ECP’s investment in May of 2012) to over 60 stores across ten cities and three countries at the time of ECP’s exit in late 2017.
It opened its latest branch in Nairobi’s Parklands area on December 19, the 62nd branch in East Africa.
ECP boasts of having raised over US$2 billion through funds and co-investment vehicles for growth capital investing in Africa.
In November, it announced the final close of its fourth Pan-African fund, ECP Africa Fund IV (AFIV), which gathered the largest representation of African investors in its history.
Domiciled in Mauritius, AFIV and its related co-investments received commitments of over US$640 million(Ksh65.3 billion), attracting a broad range of investors based in Africa, Europe, and North America.