Mondelez International and D.E. Master Blenders 1753 announced yesterday a revision of the proposed deal to win antitrust approval for their joint venture.
The two companies are now suggesting to sell the Carte Noire coffee brand instead of the two brands L’Or and Grand’Mère.
The EU competition watchdog decided earlier on Monday to extend their review of the merger until June 1 (from the previous regulatory deadline of May 13) after the companies asked for more time.
“We are proposing a new remedy package,” Mondelez and D.E. Master Blenders 1753 said in a joint statement quoted by Reuters, in response to the competition enforcer’s concerns. Carte Noire has an estimated 20 percent share of the French coffee market.
Mondelez International Inc. and D.E Master Blenders 1753 agreed last year to merge their coffee businesses, forming a new company based in the Netherlands aimed at taking on the market leader Nestle SA.
The new company will be a joint venture controlled by D.E Master Blenders’ parent JAB Holding Co. It will unite the brands of the second- and third-largest coffee companies by sales to form the world’s biggest pure-play company.
Italian leading coffee roaster Lavazza had offered more than 600 million euros ($680 million) for L’Or and Grand’Mère and was raising cash for the acquisition.
Also to this aim, the Turin-based company had announced on Monday the sale of more than half of its stake in Keurig Green Mountain. Keurig will pay as much as US$624 million to buy back its shares.
The Italian coffee maker will evaluate “any future opportunity as the transaction (between Mondelez International and D.E. Master Blenders) develops”, Lavazza said in a statement also quoted by Reuters.