Mars offloads its coffee-focused drinks business

Lavazza has acquired the coffee-focused drinks unit of Mars in a deal reportedly worth around $650 million as it bolsters its operations in the coffee machine segment.

The deal includes the Flavia tabletop machines unit and the Klix freestanding vending business, as well as brands in the office coffee service (OCS) and vending sectors.

Lavazza will acquire Mars’ coffee businesses in North America, Germany, the UK, France, Canada and Japan,

Lavazza

Lavazza

including its related systems and its production facilities in the UK and the US.

The businesses involved in the acquisition generated a turnover of approximately $350 million in 2017, and has a workforce of around 900 people. It is expected the deal will close by the end of 2018.

Lavazza Group CEO Antonio Baravalle said: “This acquisition fits perfectly within our international expansion strategy, the objective of strengthening key markets, as well as the pursuit of having an even closer relationship with end consumers.

“Indeed, this acquisition strengthens the Lavazza Group’s position in the OCS and vending segments, which offer considerable opportunities for growth and development.

“Today’s transaction with Mars Incorporated is consistent with a common vision and shared values between two prominent family-owned companies who have a strong focus on delivering quality products with uncompromising commitment to our employees and associates, with a long-term vision.”

Mars CEO Grant Reid added: “Mars drinks has been an important part of our business for many years, and while it’s always hard to say goodbye to great brands, valued associates and friends, we believe now is the right time for a change. We are confident this decision will better enable long-term success for the drinks business with Lavazza – a company that shares our values and has a dedicated focus on beverages – and will allow the business and its associates to continue to thrive.”

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