Tata Coffee to acquire US firm for $220 mln

New Delhi, June 25 (UNI) Tata Coffee Ltd today said it has signed an agreement to acquire the US-based Eight O' Clock Coffee Company (EOC) from Gryphon Investors for a total acquisition price of 220 million dollar.

The acquisition, which will be financed through a combination of equity and non-recourse debt, will transform the company from a regional coffee player in the Indian market to a significant global player with strong and powerful brands in the Indian and the US coffee markets, a company statement said here.

New Jersey-based EOC is a leading player with a 54 per cent market share in the branded whole bean coffee market in the US, with sales of 109 million dollar in calendar year 2005.

''By the end of the decade, we expect the Tata Tea group including Tata Tea, Tetley, Tata Coffee and Eight O' Clock Coffee combine to become one of the largest and most admired beverage players in the world,'' Tata Coffee Chairman R K Krishna Kumar said.

EOC Cheif Executive Officer Barbara Roth said, ''With the backing of the Tata Group we will be able to leverage our brand equity to capture new markets and new geographies.'' This acquisition is in line with the company's objective to move up the value chain and become a leading and fully integrated player in the global coffee industry, Mr Kumar said.

Tata Coffee's ownership of the US brand will enable it to transform its exports of soluble coffee and the upcoming freeze dried coffee into branded sales in the world markets.

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