NEW DELHI – UK-based food services company Indian Hospitality Corp (IHC) ) is conducting a review of India’s oldest coffee chain Barista preparatory to its possible purchase from Italy’s Lavazza, reports the Economic Times daily quoting sources familiar with the development.
It is interesting to note that IHC’s Chief Executive Officer, Ravi Deol was Barista ‘s first chief executive when the company kicked off in 2000, setting up 128 stores in India and three in Sri Lanka in his three-year term.
A Lavazza spokesperson declined to comment on a potential deal or the ongoing due diligence exercise.
It seems however that the two sides are stuck over the price of the deal, with Lavazza looking to sell the 180-outlet chain for upwards of Rs 80 crore (US$13.1 million), which IHC considers too steep, reports the daily.
With around 180 outlets, Barista is currently India’s second-largest coffee chain in terms of number of stores behind Cafe Coffee Day.
In other news Cafe Coffee Day (CCD) is close to firming up its overseas expansion plans.
Senior CCD officials indicate that they should be announcing operations in South East Asia during next financial year and they are in advanced talks with potential partners for the foray.
CCD has been looking to enter South East Asia for a while now and the V G Siddhartha-led company seems to have finally worked out the modalities.
CCD is a part of India’s largest coffee conglomerate, Amalgamated Bean Coffee Trading Company Ltd. (ABCTCL). CCD serves the coffee it grows on 13,000 acre at its own estates plus another 7,000 acre of managed estates.
The group also sources coffee from 11,000 small growers, making its holder the largest individual coffee plantation owner in Asia, in addition to being India’s only vertically-integrated (from farm to the coffee cup) coffee company.
