Illy coffee group considers listing amid consolidation

Move by family-owned company comes amid period of consolidation in coffee industry

Italian coffee group Illy has appointed Roland Berger to look at strategic options including the possibility of a stock market listing, according to people with direct knowledge of the matter.

The move by family-owned Illycaffè comes amid a period of consolidation in the €70 billion coffee industry, which industry insiders say is comparable to the beer industry tie-ups of the past decade.

Mondelez International of the United States and Netherlands-based DE Master Blenders 1753 agreed to combine their business a year ago, posing a threat to market leader Nestlé and triggering a rush among smaller players to reconsider their strategies.

In Italy, family-owned Italian group Massimo Zanetti, which owns the Segafredo and Chock Full o'Nuts brands, recently listed a third of its shares on the stock exchange in Milan valuing the company at under €500 million, while Lavazza, Italy's largest coffee group which is also family- owned, is pursuing a takeover of French-owned Carte Noire from Mondelez International.

Illycaffè, which is owned by the Illy family and based in the northern Italian city of Trieste, has for several years suggested it may consider a listing on the stock exchange.

The company said Roland Berger was “one of the several leading consultancy firms – such as Porsche Consulting, Bain & Co and AT Kearney – with which Illycaffè works, in its effort to constantly improve the company’s business and social performance”.

In 2014, Illycaffè’s total consolidated revenues reached €391 million, up 4.5 per cent compared with 2013. Operating figures were not available.

The company is led by Anna, the widow of founder Ernesto and honorary chairman of Illycaffè, and their children Francesco, Riccardo, Andrea and Anna.

Illycaffè produces and markets worldwide only one blend of high quality coffee, made of nine kinds of pure Arabica.

According to the company, almost seven million coffee cups are made daily with the Illy blend of coffee.

Illy coffee is sold in more than 140 countries and is available in more than 100,000 bars. – Copyright The Financial Times Limited