The ever-growing Retail Food Group is once again opening its purse strings, this time to acquire one of Australia's largest specialty coffee groups. The transaction will significantly enhance the company's coffee and allied beverage distribution.
Di Bella Coffee is set to join the RFG portfolio in January 2015. Founder and managing director Phillip Di Bella will move across to the franchisor group to oversee the business and take on a bigger role within the coffee and beverage management division.
Tony Alford, CEO of RFG said "Not only will Mr Di Bella's retention facilitate seamless transition of the business, it affords RFG another layer of coffee expertise. Di Bella complements and extends the company's existing market penetration by providing the group with a reputable specialist coffee brand to grow scale amongst each of its coffee and allied beverage distribution channels including franchisee, contract roasting, commercial and the rapidly growing in-home capsule opportunity inherent in the Gloria Jean's Coffees acquisition, due for imminent settlement."
The plan to acquire Di Bella Coffee meets RFG's key acquisitive criteria: immediately earnings per share accretive, generates increased supply-side scale, a vertical integration opportunity.
Acquisition includes the global intellectual property of Di Bella Coffee, a roasting and wholesale coffee business with established channels across Australia's eastern seaboard, Western Australia and internationally with a 70/30 commercial and contract retail distribution. It also includes boutique coffee based products and a growing online sales channel.
On settlement RFG will pay $27.4m in cash and RFG ordinary shares to the value of $2.6m. There are milestone and earn-out performance based payments up to $17.3m outlined