Coffee Republic receives takeover approach
Loss-making coffee bar group Coffee Republic has been approached by a potential buyer.
The firm issued a statement this morning saying it had "received an approach which may or may not lead to an offer being made for the entire issued share capital of the company."
The announcement follows news yesterday that rival chain Caffe Nero had bought a 4.32 % stake in the company, news that had already sparked takeover speculation.
At the end of last month Coffee Republic said it was calling a halt to its expansion programme following losses of £7.5m to the year ending 31 March.
The chain also plans to sell 18 underperforming bars and has launched several schemes aimed at improving sales and cutting costs.
Market commentators blame the difficulties faced by independent coffee chains in the UK on Starbucks and its aggressive campaign of expansion which has forced its competitors to follow its pace.
Speculative investors have been buying stock in Coffee Republic in anticipation of a buy-out. They include Julian Richer, the hi-fi retailing tycoon, who has accumulated more than 16%.
