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Whitbread Sets Sights on Coffeeheaven

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LEISURE group Whitbread  confirmed a potential expansion to its coffee empire as it revealed takeover talks with central European chain Coffeeheaven International.

Whitbread, which owns the Costa Coffee business, said it was in “advanced discussions” over a possible cash offer.

The firm said its bid would be worth 24p per Coffeeheaven share – valuing the company at pounds 32m.

Costa currently has a handful of stores in Poland but these are run on a franchise basis.

Whitbread also owns Premier Inn budget hotels and a pubs restaurant division. It has continued to expand its coffee chain through the recession.

It added 100 new Costa shops in the six months to August 27 this year – bringing the total to nearly 1,000 in the UK and more than 400 overseas.

The division was said to have produced an “outstanding” performance in that period, with operating profits up 70% to pounds 12.6m, on revenues up 21% to pounds 155.4m.

Coffeeheaven has around 90 sites, mainly in Poland, but also in the Czech Republic, Latvia, Bulgaria and Hungary.

The firm, which trades as Coffee Nation in Latvia, is listed in London but based in Warsaw, in Poland.

It markets itself as “redefining the central European speciality coffee/sandwich bar market” with a “level of quality in product and service comparable to similar concepts anywhere in the world”. In the firm’s most recent results for the six months to September 30, it said it had a 23% market share in Poland and the country looked to be an “economic out-performer” in Europe.

Pre-tax profits before incentive payments were up 181% to pounds 237,880, on group turnover up 16%.

In a statement following press speculation on the issue today, Whitbread said there was “no certainty that an offer will be forthcoming”.

Whitbread is due to give an update on more recent trade on Monday.

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Monday, November 20, 11:58 am

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