Massimo Zanetti to acquire minority equity position in Club Coffee

Massimo Zanetti Beverage USA (MZB), a Portsmouth, Va.-based supplier of coffee under its own brands and for private labeling — and the North American operating unit of the Italian global coffee roaster and marketer Massimo Zanetti Beverage Group — said it plans to acquire a 25.1 percent minority equity position in Toronto-based Club Coffee for $25.1 million (CDN), positioning both companies to boost sales growth through market-leading innovations.

The parties said they anticipate their agreement will enable MZB to expand its reach in Canada and for Club Coffee to enhance its U.S. presence. The equity investment is expected to be finalized before the end of calendar year 2015 and is subject to the parties’ successful conclusion of due diligence and other pre-closing conditions.

MZB’s collaboration with Club Coffee includes bringing the world’s first certified 100 percent compostable single-serve hot beverage technology to market. MZB said it will be the first company to give consumers a 100 percent compostable solution to their concerns about single-serve coffee waste, starting with its Hills Bros coffee brand in January 2016.

“MZB knows that market leadership comes from seeing what consumers want, then delivering effectively," said John Boyle, MZB USA’s chief operating officer. “We know consumers want a more sustainable option for their single-serve coffee, and we are confident that our certified 100 percent compostable pod is the right solution.

"This equity stake demonstrates our enthusiasm for Club Coffee’s commitment to technology that delivers this simple solution," he added. "It also underscores our determination to build market leadership through the innovation and the quality consumers demand.”

MZB and Club Coffee said they were among the first companies to act on consumer concerns about the waste associated with single-serve coffee. In 2013, MZB brought an advance to the market with its Filter Cup format, which significantly reduced the amount of plastic compared to traditional single-serve plastic cups. The two companies announced the development of the PῧrPod100 single-serve pod in April 2015, followed by a September announcement that the pod had earned certification from the Biodegradable Products Institute as industrially compostable.

“Our companies see significant opportunities for growth in the coffee market. PῧrPod100, our certified 100 percent compostable single-serve pod, is just the first of those opportunities,” said John Pigott, Club Coffee's CEO. “This strategic shift takes the long record of collaboration between both businesses to a new level. It positions MZB and Club Coffee to bring more new solutions to our customers across the coffee, tea and other hot beverage sectors."