U.S. coffee company Green Mountain Coffee Roasters Inc. has expanded into Canada by buying the wholesale business of Toronto-based Timothy’s Coffees of the World Inc. for about $165 million, entering an ultra-competitive market that features java heavyweights such as Tim Hortons and McDonald’s.
The purchase, announced early Friday, includes the Timothy’s World Coffee brand and wholesale business, but does not include the coffee company’s 139 retail outlets across Canada. Those have been sold to another buyer.
Green Mountain, known for its specialty coffees and the Keurig single-cup coffee dispenser, said the acquisition of the Toronto specialty coffee company from Sun Capital Partners Inc. will boost its presence in Canada and North America.
“Timothy’s is a great addition to [Green Mountain’s] family of brands,” Lawrence Blanford, Green Mountain’s president and CEO, said in a release.
“We have been collaborating together since they became a Keurig licensee and know the company is a great strategic and cultural fit. We believe that Timothy’s, along with our Green Mountain Coffee brand, will contribute meaningfully to our future success in Canada and throughout North America.”
The retail portion of Timothy’s is being bought by Bruegger’s Enterprises Inc., a U.S. company that operates bagel restaurants across the United States and is also part of Sun Capital Partners.
The deal will likely present Canadian consumers with more choices in the coffee market, where Tim Hortons, McDonald’s Canada, Second Cup, Timothy’s and regional players battle for market share.
Timothy’s, however, is more than a coffee retailer. It is also a supplier of specialty coffees to offices, hotels, grocery stores, retailers and food services outlets throughout Canada and the U.S. In Canada, the company does business under the Timothy’s World Coffee, Michel’s Baguette Bakery Cafe, and mmmuffins brands, as well as Levain Bakery, a specialty baker.
Sun Capital said Bruegger’s acquisition of the Timothy’s retail operation not only expands that company’s footprint into Canada, but also adds new distribution channels for the company’s kettle-boiled “New York-style” bagels.
