MILAN (Reuters) - Lavazza, the world's seventh-biggest coffee roaster, has offered to buy French brand Carte Noire for around 800 million euros (£557.7 million) in a deal that would treble the Italian company's turnover in France, sources close to the matter said.
Lavazza said in a statement that it had made a binding offer to purchase Carte Noire from Douwe Egberts BV, subject to approval by the European Commission and French authorities.
It did not mention financial details but two sources said the Italian company would pay around 800 million euros.
The French premium brand was put on the block in February to sooth European Commission concerns over competition after U.S.-based group Mondelez International (O:MDLZ) and Dutch group D.E Master Blenders set up Douwe Egberts BV, a joint venture, to create the world's biggest standalone coffee company.
Family-owned Lavazza said it had offered to purchase Carte Noire's roast and ground coffee, filter pads and Nespresso-compatable capsules business as well as the French company's plant in Laverune, near Montpellier.
With this deal, Lavazza "will reach a leadership position in France, the fourth global coffee market and the second in Europe," Chief Executive Antonio Baravalle said in a statement.
Baravalle told Reuters last year that the company planned to increase its annual revenues by almost 50 percent to 2 billion euros within 10 years to avoid being swallowed by bigger competitors.
Lavazza's offer values the French brand at 11.5 times its core earnings, according to the source.
The coffee maker beat off competition from several private equity groups that were looking at the French asset, according to the source.
JP Morgan was adviser for Lavazza on the acquisition, while Lazard worked with Mondelez's on the deal.