Lavazza to Purchase Stake in Green Mountain
September 8, 2010,
WATERBURY, Vt.-Green Mountain Coffee Roasters and Luigi Lavazza S.p.A. have formed an agreement in which Lavazza will purchase a stake in Green Mountain. The two companies are also working on a further agreement through which they will develop single-serve espresso machines.
Under the terms of the purchase deal, Lavazza will buy $250 million of newly issued shares of Green Mountain's par value common stock, amounting to 7 percent of Green Mountain's current outstanding shares. This purchase, which requires approval under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, is expected to close this month.
When the second agreement is finalized, Green Mountain and Lavazza will cooperate to develop and manufacture single-serve espresso machines and single-serve espresso capsules. The new products would complement Green Mountain's line of Keurig single-cup coffee brewers. A joint statement from the two companies said the product-development agreement may also allow Green Mountain to distribute, market and sell existing single-cup espresso machines using Lavazza's technology for in-home use in the United States and Canada.
The new products would not be available to the marketplace until Green Mountain's fiscal year 2013.