By Tom Joyner and Catie Low
The man behind the Grill'd premium burger brand has emerged as the new owner of troubled chocolate chain Koko Black amid expectations up to three stores may close under the new ownership.
Koko Black administrator Deloitte wrote to the chain's employees this week to let them know Grill'd managing director Simon Crowe had bought the business and planned to appoint a new chief executive in the "near term".
Grill'd founder Simon Crowe is moving into the chocolate business.
Mr Crowe would not reveal how much he paid for the Koko Black business but Deloitte in its letter to staff said it "expected that only two to three salons will not be transferred to the new owners".
Deloitte said Mr Crowe was working through a "transition plan" to ensure a smooth journey out of administration and a final decision on the sites slated for closure would be made by January 22.
In the letter to staff Mr Crowe said he was a long-time admirer of Koko Black.
"Its culture is founded on product quality, creativity and design, this does not need to change – rather it needs to be adequately supported by improved systems, processes, reporting and analytics," Mr Crowe said.
He said the ultimate plan was to invest in the chocolate chain and take it to the "next level of growth".
Retail consultant Brian Walker said food had been one of the key drivers of retail in the past few years.
"When you look at the retail trade figures, a lot of that growth has been in food and hospitality," Mr Walker said.
He said the Koko Black chain was nice complementary business for Grill'd and Mr Crowe had the skills and experience to make the operation's cost base more efficient.
"And if it's in administration, he clearly would have bought it at the right price," Mr Walker said.
Koko Black, which was put into administration in November, will be owned separately to Grill'd and Mr Crowe is analysing the chain and in negotiations with its landlords for a number of its outlets.
At the appointment of administrators, Deloitte Restructuring Services' Sal Algeri said the luxury chocolate chain was a victim of its own ambitious expansion plans.
Mr Algeri said the business grew too quickly and embarked on a number of major projects beyond its resources.
Shane Hills founded Koko Black from a single store in Melbourne's Royal Arcade in 2003 but it now trades through a network of 14 stores around Australia.
It's recently expanded into New Zealand but these stores are not affected by the collapse.
Koko Black employs about 300 people, including its production team in the Melbourne suburb of Coburg, and it received a $3 million Victorian state government grant last year for its $10.9 million Alchemy Hall Project, which was to include a manufacturing centre of excellence as well as a visitor centre.
Under the new ownership, Koko Black staff will be offered new employment by January 25 on terms and conditions similar to their existing agreements and Deloitte said all employee entitlements, including years of service, would be transferred to the new owners.