Dive Brief:

• Lavazza Group acquired an 80% stake in Kicking Horse Coffee from private-equity fund Swander Pace Capital, valuing the company at about $160 million, the companies said in a statement.
• Originally founded 21 years ago, Kicking Horse Coffee is a Canadian maker of organic and fair-trade coffee for the Canadian and U.S. markets.
• “Kicking Horse Coffee represents one of the ‘local jewels’ the Lavazza Group continues to seek as part of its globalization and premium positioning strategy,” Antonio Baravalle, chief executive officer of the Lavazza Group, said in a statement. “Today, organic fair-trade coffee is one of the fastest-growing trends at the international level, and in North America in particular. Kicking Horse Coffee leads this segment with a brand that is perfectly complementary to the Lavazza portfolio.”

Dive Insight:

Lavazza Group already has success in more than 90 countries, but buying Kicking Horse — valued at an estimated $160 million — gives them a broader presence in both the U.S. and Canada that the Italian-based roaster has been building in recent years. It also expands the coffee giant's product line with organic fair-trade, one of the hottest growing segments internationally.

Consumers, especially in the United States, are increasingly looking for more sophisticated premium coffees, and Lavazza is smart to capitalize on this growing trend with its recent purchase. Coffee continues to be a strong industry and while new offerings such as infused coffee and single-packs are gaining steam in the industry, the traditional coffee products still do very well on the grocery shelves.

Kicking Horse allows Lavazza to expand its global strategy outside of Western Europe, which is being impacted by slow economic growth. With a powerhouse in its new owners, Kicking Horse will only grow as it expands to new markets. Lavazza also will benefit from Elana Rosenfeld, who founded Kicking Horse in 1996. She retains a 20% equity stake and will continue to oversee the niche coffee purveyor.

Lavazza is not the only foreign company to look North America for growth. JAB Holdings, for example, has snapped up Keurig Green Mountain, Peet's Coffee and Tea as well as Caribou Coffee in recent years. If these deals and the Lavazza purchase are any indication, expect more European companies to look west for their next cup of coffee.