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British expansion fueled on caffeine

  • 2009-12-17
  • From wire reports

RIGA British firm Whitbread, which runs the Costa Coffee chain, the largest cafe chain in the United Kingdom, could soon enter the Latvian market, reports news agency LETA. The company has announced its plans to acquire Warsaw-based Coffeeheaven International, owner of the Coffee Nation chain in Latvia. Management announced last week that talks with Coffeeheaven International moved ahead significantly. The prospective deal is estimated to be worth around 32 million pounds (35.2 million euros).

The takeover would allow further business expansion for Whitbread, which is looking to increase the number of its stores to 2,000 in 2010- 2011. The UK-registered Coffeeheaven International operates 92 cafes in Central Europe. The company’s core business activity and headquarters are in Poland, where the chain has 62 cafes. It has 15 cafes in the Czech Republic, seven in Latvia, and four each in Bulgaria and Hungary. Coffeeheaven International entered Latvia in 2005 through its purchase of the local quality coffee shop chain Coffee Nation, which was started in 2001.

Member of Coffee Nation’s board Ludmila Kropivieca said that she has no information about the sale of the parent company. “I am surprised to hear that, because our owners are actively making investments. We are developing. Just recently we completely renovated the cafe on Blaumana Street, and we are looking for new premises in Riga Old Town.” In the first half of the last financial year, which ended on Sept. 30, the company reported sales of 577,000 lats (824,000 euros), compared with 654,000 lats in the same period a year earlier. Whitbread was founded in 1742. In addition to Costa Coffee, it owns Premier Travel Inn hotels, the Brewers Fayre and Beefeater chains of pubs and restaurants, and David Lloyd Leisure sports clubs.