Dutch coffee supplier DE Master Blenders is to merge the coffee arm of US food giant Mondelez into a new group to fight for market share in the booming coffee capsule sector.
The deal will see the Dutch blender's best known coffee brand Douwe Egberts team up with Mondelez's Jacobs and Carte Noir to take on other giants in the market such as Nestlé.
Under the deal, Master Blenders, owned by a German investment group, will pay $5.0bn (€3.5bn) in cash. Mondelez will also end up with 49.% of the new player, which they have said will be a world leader.
This new player in the coffee sector will be called Jacobs Douwe Egberts (JDE) and will be based in the Netherlands.
In a joint statement, the two groups said: ‘This strategy will create the world's leading pure... coffee company’.
The statement added that the new company ‘will hold leading market positions in more than two dozen countries and will have a strong emerging market presence, giving it significant revenue synergy opportunities.’
The new entity would have annual sales of more than $7bn (€5bn), the companies forecast.
Mondelez is a leader in the snack sector, and also owns coffee brands such as Gevalia and Tassimo, while Amsterdam-based DE Master Blenders owns several global coffee and tea brands including Douwe Egberts, Senseo and Pickwick and traces its origins back to 1753.
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