Coffee Day Enterprises in JV with WMF to make coffee vending machines

Coffee Day Enterprises Ltd, which runs India's top coffee chain under the Cafe Coffee Day (CCD) brand among other businesses, has floated a joint venture to manufacture coffee vending machines in Chikkamagaluru, in partnership with German automatic coffee machine manufacturer WMF.

The two companies had announced the plans for setting up a manufacturing unit in partnership in August this year. The JV has now been created.

While WMF Group holds a 51 per cent share in the joint venture, Coffee Day holds 49 per cent.

"As part of the joint venture, both companies are investing in a new factory in India for the production of coffee machines," the company said in the statement.

Financial terms of the deal, however, were not disclosed.

"In the future, Coffee Day Global Ltd will supply its customers; for example, offices or restaurants, with products co-branded as ‘Coffee Day by Schaerer’," it said in the statement. Schaerer is a subsidiary of the WMF Group.

Currently, Coffee Day Enterprises manufactures 6,000 coffee machines per year in Bengaluru and counts corporate, educational institutions, hospitals and hotels as its clientele.

Once the proposed coffee machine manufacturing plant opens in Chikkamagaluru, Coffee Day will cease manufacturing coffee machines in the state capital.

Coffee Day, which recently went public, had opened its first Café Coffee Day outlet in Bengaluru in 1996 and is the largest player in its business in India.

On the other side, founded in 1853 in Germany, WMF manufactures coffee machines, consumer products and hotel equipment.

AZB & Partners advised WMF Group GMBH on this transaction.

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