City wakes up to bid for Coffee Republic

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The Independent Online

Coffee Republic, the ailing coffee shop chain, yesterday revealed it has received a takeover approach a day after its rival Caffè Nero acquired a 4.32 per cent stake.

Coffee Republic, the ailing coffee shop chain, yesterday revealed it has received a takeover approach a day after its rival Caffè Nero acquired a 4.32 per cent stake.

Neither company would comment but the approach is understood to have come from a third party, with Caffè Nero hoping to make a quick profit from any bid, although it could be drawn in to a bidding war.

Analysts pointed the finger at Julian Richer, the hi-fi tycoon with an estimated £145m fortune, who has a 16.03 per cent holding in Coffee Republic.

Others suggested the smaller competitor Madisons Coffee, which is listed on AIM, could be interested. The approach may also have come from a larger leisure or restaurants group looking to diversify, or a venture capital buyer believing it has sniffed out a bargain.

Shares in Coffee Republic rose 0.25p to 4.75p after 12 million shares changed hands. The rise came on top of a 1.25p increase the previous day and leaves the company valued at £10.3m. Analysts at Numis Securities expect any bid to be pitched at 6p to 7p a share, but said that without an offer the shares were worth just 2.5p.

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