Luigi Lavazza spa, the world’s seventh coffee roaster, has made an offer to Koninklijke Douwe Egberts B.V. (controlled by Mondelez International) to purchase Carte Noire, the French market leader in coffee with about 20% market share in the retail channel. Carte Noire is said to be valued 800 million euros or about 11.5x ebitda.
According to the terms of the offer, Lavazza would take control of the Carte Noire business within the European Economic Area (EEA) with the exception of Carte Noire instant coffee, T-Discs and out-of-home businesses (download here the press release).
The deal is no surprise as last February D.E. Master Blenders and Mondelez International announced they had reviewed their plans in order to get a go-ahead by the European Commission to their planned merger (see Reuters here).
More in detail, the two group said then they had been informed by the EU Antitrust Authority that they should have put in action different strategies versus the ones they proposed in a first time that were sales of L’Or and Grande Mere coffee brands, for which Lavazza had put forward a 600 million euros subject to a go ahed by the European Commission (see here a previous post by BeBeez).
“With this strategic acquisition we believe we would be making an important step forward to become a global Company. This deal would be totally consistent with our international development strategy, aimed at both organic and inorganic growth”, Lavazza’s ceo Antonio Baravalle commented.
“We established our very first foreign operation in France back in 1982. Since then, France has been a very important market for Lavazza and we expect it will be even more in the future. With Carte Noire”, declared Alberto Lavazza, chairman of the company, “which is a French icon with a unique premium positioning, a strong brand image and awareness, France would become our second most important market”.
In the race for Carte Noire were some private equity firms too such as BC Partners, Pai and Cinven. For the deal Lavazza is supported by financial advisor JPMorgan, while Mondelez is advised by Lazard.