Conditional agreement to acquire 100% of Mojo Coffee Cartel will give Cooks access to the US boutique coffee shop market in deal worth approximately US$12.6m
Cooks Global Foods has set sights on the US specialty coffee shop market after entering into a conditional agreement to acquire New Zealand-based boutique chain, Mojo. The terms of the acquisition include a purchase price of $7.8m, the purchase of $3.5m Mojo’s debt and the distribution of approximately $1.3m in Cooks shares to Mojo shareholders.
Founded in 2003, Mojo has built a successful coffee shop brand revolving around individually designed boutique stores, a roastery and retail business. It currently operates 36 coffee shops across Wellington and Auckland in New Zealand and single café and roastery site in Chicago. The chain also has four licensed sites in Japan and two in China.
Singling out the US market, Cooks Executive Chairman, Keith Jackson, said the deal would be “transformational” in enabling his firm to achieve its international growth ambitions. “[Mojo] has already established a strong presence in Chicago with increasing customer awareness and Americans' developing taste for good coffee,” he said.
Cooks, which owns the master franchise to Esquires Coffee in 14 international markets, joins a growing number of firms seeking to capitalise on the popularity of boutique coffee shop brands in the US. In 2017 California-based boutique chain, Bluebottle, which operates more than 60 stores in the US and Japan, was acquired by Nestlé for a reported $425m
. In July 2018, Melbourne-inspired Bluestone Lane, which operates 30 stores in the US and is rumoured to be considering international expansion, received a $19.5m investment from hospitality and leisure firm, RSE Ventures, to double its US footprint.
Under the terms of the preliminary deal, Mojo will retain its current branding, with co-founder, Steve Gianoutsos, and other company executives joining Cooks’ senior management team while continuing to run the Mojo business.
“I’ve been working in the flagship Chicago store and we’re going to look to push out into the US and beyond," said Gianoutsos, who is expected to lead the US expansion, in a press statement.
Cooks already owns several New Zealand-based firms, including ethical coffee retailer Grounded and fairtrade tea company, Scarborough Fair. It also owns the global master franchise to Canadian coffee shop chain, Esquires, excluding Australia and New Zealand. In March 2018, Cooks announced a ten-year plan to open 40 Esquires stores in Pakistan and 30 in Jordan
as part of plans to expand the chain’s global footprint.
The Mojo acquisition is expected to be finalised on 31 October 2018.