JSE-listed Spur Corporation is confident about the outcome of a multi-million-rand high court dispute with a South African subsidiary of the global GPS Food Group.
The parties agreed to refer the matter to arbitration, and Spur said last week in an update on the dispute in its results for the six months to 31 December 2024 that closing arguments in the arbitration were concluded on 9 December 2024. The parties currently await the outcome.
Read: End in sight for multi-million-rand damages claim against Spur [Aug 2024]
Spur said subsequent to the end-December reporting period, its attorneys, together with senior counsel, assessed and presented a review of the merits of the case and prospects of success – and concluded that, based on the information available to them, it is more likely than not that Spur will be able to successfully defend the claims.
“Supported by the opinion of its legal advisers, the board considers that the probability of the occurrence of the claimed losses, at this point in the legal proceedings, is therefore not likely,” it said.
“No liability has accordingly been raised at the reporting date regarding the matter.”
Claims
The dispute was set down for trial on 23 October 2023 for a period of three weeks but was referred to arbitration by agreement between the parties. Arbitration commenced on 23 October 2023 but has been impacted by a number of adjournments.
It follows GPS Food Group RSA (Pty) Ltd serving two companies within the Spur group with a summons on 24 December 2019.
Read:
Spur Corp facing R183m damages claim [April 2022]
R183m damages claim against Spur Corp to be heard in October [Jul 2023]
Over R100m damages claim against Spur goes to arbitration [Dec 2023]
GPS Food Group RSA is a subsidiary of a global business specialising in the management of the procurement, production, logistics and marketing elements of supply chain.
The summons contained two alternative claims (which were further amended on 11 July 2023):
- Claim A, comprising a damages claim of R167 million – alternatively R146.8 million and further alternatively R119.9 million – comprising accumulated counterfactual profits less accumulated actual losses for the term of an alleged joint venture of 15 years, alternatively 10 years and further alternatively five years; and
- Alternative Claim B, comprising a delictual claim of approximately R95.8 million, comprising GPS’s alleged accumulated losses to the date of the claim.
Spur confirmed that it has engaged with GPS over several years regarding product supply and that it also engaged GPS regarding the prospects of concluding a joint venture to establish and acquire a rib processing facility.
GPS Food Group alleges that an oral agreement was concluded between GPS and two Spur companies in terms of which the parties would, among other things, establish a joint venture to acquire, develop and manage a rib processing facility.
However, Spur claimed that “no written agreement was ever executed with GPS”.
GPS further alleges that over a period Spur repudiated the alleged oral agreement, thereby giving rise to a breach of contract and damages.
GPS alternatively alleges that, in the event of it being found that the Spur companies did not become bound by the oral joint venture agreement, the conduct of the Spur companies represented that they regarded themselves as bound by the agreement and that GPS could rely on such representations and implement its contribution to the alleged joint venture, thereby giving rise to a delictual claim for damages.
Spur said the two group companies have defended the claims in terms of their plea on 12 February 2021, which was consequently amended on 11 October 2023 following GPS’s amended claim, and denied the allegations made.
The group said the two Spur companies have pleaded certain defences, including that the discussions held with GPS did not amount to the conclusion of a joint venture.
“In amplification, any joint venture would have been subject to approval of the boards of the respective defendants [Spur], and subject to the agreement(s) being reduced to writing,” it said.
“Neither of these events transpired and the terms of the alleged joint venture agreement constituted an unenforceable agreement to agree.”
Various attempts by Moneyweb since 2022 to obtain comment from GPS on the matter have been unsuccessful.
A possible complicating factor for GPS Food Group in attempting to prove its claim is the death of former Spur Corporation CEO Pierre van Tonder on 9 May 2021.
Read: Former Spur Corporation CEO Pierre van Tonder passes away
Spur Corporation reported in May 2021 that Van Tonder, who was MD and CEO of the group for 24 years and retired in December 2020, had shot himself at his home in Cape Town.
Rib facility
GPS Food Group established a rib supply and processing facility in South Africa in about 2017 after acquiring premises in Cape Town.
It is believed the intention was that the facility would be an exclusive supplier to Spur Corporation and its franchised outlets.
The facility stopped production in 2020, with the premises and the assets subsequently sold and the remaining staff retrenched.
The facility is believed to have employed up to 100 people in peak season.
Spur interims
Spur Corporation last week reported 10% growth in franchised restaurant turnovers to R5.9 billion in the six months to end-December 2024.
Listen: Market-leading results from Spur [Mar 2025]
Headline earnings per share improved by 11.8% to 178.35 cents.
The group declared an interim dividend per share of 106 cents, which is 11.6% higher than the 95 cent interim dividend declared in the prior comparative period.
Shares in Spur declined 2.92% to close at R33.30 per share on Friday, after rising by 3.12% to R34.34 on Wednesday, the day it published its interim results.
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3/7/2025, 4:55:14 PM
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