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Whitbread’s Costa Coffee Agrees Coffeeheaven Acquisition

Whitbread’s Costa Coffee Agrees Coffeeheaven Acquisition

Costa Coffee parent company, Whitbread Plc (LSE: WTB) reached an agreement with Eastern European ‘coffee bar’ operator Coffeeheaven international (AIM: COH), whereby the FTSE100 constituent will acquire the group for 24p per share. The company will be integrated into the Costa Coffee business, providing the growing subsidiary with an established Central and Eastern European platform.

On Friday the respective companies acknowledged they were in ‘advanced discussions’ following bid rumours. At 24p per share the offer represents a 22% premium on Thursday’s closing price. Whitbread has received irrevocable acceptances for approximately 18.98% of the company’s issued share capital, from all the Coffeeheaven Directors and certain other shareholders.

“It is an important step forward in achieving Costa's strategic objectives and international growth ambitions” Costa Coffee Managing Director, John Derkach commented, “This transaction will give Costa a strong position in the important and rapidly growing Central and Eastern European market”

The potential acquisition would appear to provide an attractive proposition for the expanding business, which has set a 2,000 store growth target across international markets for 2010/2011.

In 2001 Coffeeheaven joined the AIM market, becoming the first Polish company to be listed on the junior stock exchange. The group now operates 92 speciality branded coffee bars in Central Europe under its Coffeeheaven and CoffeeNation brands, the bulk of its business is in Poland, with other bars in Czech Republic, Latvia, Bulgaria and Hungary.

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