Date:01/10/2005 URL: http://www.thehindubusinessline.com/2005/10/01/stories/2005100102420800.htm

Back Sterling Group, Italy's illycaffe tie up for coffee machines

Our Bureau

Dr Andrea Illy, ChairmaN & CEO, illycaffe with Mr V. Srinivasan, Director, Barista Coffee Company Ltd, at a press conference in the Capital on Friday. — Kamal Narang

New Delhi , Sept. 30

STERLING Group, which owns Barista Coffee Company, has tied up with Italy's illycaffe to jointly invest up to $20 million over the next five years for installing 6,000 coffee machines in the country.

As part of the agreement, Sterling Infotech Group's Fresh & Honest Cafe Ltd (F&H) will be illycaffe's exclusive distributor in India and will be responsible for taking illy products to consumers.

"The partnership agreement includes an investment of $15-20 million over the next five years to install coffee equipment and establish the illy brand in India," Mr V. Srinivasan, Director, Barista Coffee Company Ltd, said.

Chennai-based F&H will install the espresso machines in hotels, cafes and restaurants apart from corporate companies and public places.

In addition to addressing multiple revenue streams through a combination of products, both hot and cold, made from illy espresso beans and ground coffee, F&H will also address the out-of-home and at-home markets.

``Our research shows that a category of consumers in India are demanding premium international brands. Up to now illy availability has been restricted to some luxury hotels. We see a significant opportunity in expanding our reach to the end consumers,'' illycaffe's Dr Andrea Illy said.

Sterling Infotech Group had acquired 100 per cent stake in coffee chain outlet Barista last year.

Currently, Barista has 130 outlets throughout the country and will have over 250 shops by end of 2006.

The company will be setting up about 50 new outlets during the current year.