The Hindu Business Line : Tata Coffee mulls acquiring brand in Russia

Tata Coffee is looking at brands for acquisitions. Talking to Business Line, Mr M.H. Ashraff, Managing Director, Tata Coffee Ltd, said the company is seriously contemplating acquiring a brand in Russia.

While maintaining that it had not identified the brand that it proposed to acquire, Mr Ashraff said the acquisition announcement would be made within the next six months.

To yet another query, he said, “We are seriously looking at the Russian market. We plan to acquire a brand there or leverage the Eight O’Clock or the Tata brand itself.”

It may be recalled that Tata Coffee acquired the New Jersey-headquartered Eight O’Clock Coffee company from Gryphon Investors for a total acquisition price of $220 million (Rs 1,015 crore) in 2006.

Eight O’Clock Coffee was then the third largest coffee brand by volume behind Folgers and Maxwell House.

Brand acquisitions, Mr Ashraff said are in line with the company’s objective “of eventually emerging a leading and fully integrated player in the global coffee arena”.

Outlet in Coimbatore

Tata Coffee has launched its first stand-alone outlet, Mr Bean Coffee Junction, in Coimbatore.

Mr Bean Coffee Junction, according to Mr M.H. Ashraff, would combine roast and ground coffee sales with vending and retailing. “We are not competing against the Café Coffee Day or Barista or Naraasus. Ours is a unique proposition. The Bean Junction is neither a café nor a coffee outlet.

“We perceived the need for the connoisseurs of coffee to get the best of both and decided on the coffee junction. Coffee would be the focal point at the Mr Bean Coffee Junction,” he explained.

Consumers would not only be able to buy the roast and branded coffee to their blend but also enjoy coffee shop experience, he said adding that five major blends and a combination of these blends would be available at the junction.

“One can taste the coffee before making the choice on the blend.

“We will record the buyers personalised taste and preference in our data base, so he has no qualms when he comes back for more,” Mr Ashraff said.

The company plans to roll out at least 4 such stand-alone outlets in the key markets in South India.

“Our next coffee junction would come up in Chennai,” he said, but refused to divulge the outlay.

Turnover

On performance, he said the company’s turnover was Rs 270 crore last year, with exports contributing to 90 per cent of the total sales.

Tata Coffee produces about 9,000 tonnes of green bean and 6,500 tonnes of instant coffee.

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