The Italian Almanac
Historic Italian coffee maker Lavazza has chosen India for the first plant it will build outside Italy, the Turin company said. Analysts said the choice reflected the growing importance of the Indian market, and the Asian one in general, to the Italian coffee retail leader. The plant will be built at a new model town called Sri City on the borders between the states of Tamil Nadu and Andhra Pradesh in southern India. It will produce ground coffee as well as beans and capsules for the Barista chain it bought in 2007.
Lavazza is looking to grow abroad "in four or five select markets, given that it cannot expand further in Italy due to anti-trust laws," its director of acquisitions for Asia and Australia, Luca Maulini, said recently. These markets include India, China, Brazil and the United States, where the company "is not out to make a quick buck because it prefers to build a name and a business, while getting the best deal possible," Maulini said. As an example the executive recalled that four years ago in Britain Lavazza was offered a chain of coffee shops "but at the time we thought the price was too high and we didn't buy it. This year the same chain was offered to us again but at a third of the original price".
At the end of September Lavazza completed the acquisition of a 7% stake in Green Mountain Coffee Roasters (GMCR) of the US for $250 million, the biggest investment the family-owned Italian company has made abroad. Lavazza and GMCR also entered into a partnership to develop new single-serve espresso machines and single-serve espresso capsules designed for use in these machines.
Lavazza, founded in 1895, is one of the world's largest coffee manufacturers and the retail market leader in Italy. It directly operates 11 international subsidiaries and its products are marketed in 90 countries.