Strauss Coffee is furthering its expansion in Russia, acquiring the full ownership of LeCafé, a manufacturer of black and instant coffee, for $13.4 million.
Strauss has bought an additional 49% in Russian LeCafé and Instanta, completing the purchase of 100% of these companies' shares.
While he announced the acquisition, Strauss Group President and CEO Gadi Lesin commented on reports that the company planned to sell its coffee activity.
"There is no basis to this matter. We are persisting in our acquisition of companies and expanding in the coffee market, especially in Russia, where we see huge potential for growth," he said.
About two years ago, Strauss bought the LeCafé brand and 51% of LeCafé and Instanta shares in a deal totaling $34 million at the time.
About a year ago, Strauss acquired an instant coffee plant in Germany with the intention of selling all of its produce to the Russian market and complement the activity of LeCafé.
The current deal will be funded from Strauss Coffee's independent sources and is subject to the approval of Russia's antitrust authority.
Russia is Strauss Coffee's second largest market, with annual sales of $250 million. The Brazilian market is the largest, with $450 million in black coffee sales. The Israeli market is the third largest.