Queensland-based Retail Food Group (RFG) has reached a deal to acquire the Adelaide-based coffee chain CIBO Espresso from Retail Zoo for AU$2.7 million (US$1.7 million), marking a significant move in the competitive Australian coffee shop industry. The acquisition, which includes 22 CIBO Espresso outlets across South Australia and its associated intellectual property, is set to be finalized by July 2025.
RFG, which is based in Queensland, plans to invest AU$1.3 million (US$857,000) to transition CIBO Espresso’s franchise locations into Gloria Jean’s coffee shops, effectively discontinuing the CIBO brand. This strategy forms part of RFG’s broader goal to expand and strengthen its existing café and coffee business, particularly through its flagship Gloria Jean’s chain.
“This acquisition is a key step in our strategy to grow our core brands within the Café, Coffee, Bakery (CCB) segment, and aligns perfectly with our goal of making Gloria Jean’s the most visited beverage destination in the world,” said Matt Marshall, CEO of Retail Food Group.
CIBO Espresso, which was founded in 2000 by the owners of North Adelaide’s Italian restaurant CIBO Ristorante, has been a prominent name in the Australian coffee scene, generating AU$20 million (US$13.2 million) in annual sales from its 22 stores. While RFG’s purchase includes the intellectual property and stores, the CIBO brand itself will be phased out as the outlets are rebranded to Gloria Jean’s.
The transition is expected to give Gloria Jean’s a considerable boost in South Australia, where the brand currently operates six locations. Gloria Jean’s, which had 138 stores across Australia as of August 2024, will benefit from the addition of the 22 CIBO locations, further solidifying its position in the competitive Australian coffee market. Currently, Gloria Jean’s South Australian outlets generate AU$5 million (US$3.3 million) in sales annually, and the new outlets will significantly increase both its footprint and revenue in the region.
Gloria Jean’s Growth and RFG’s Strategic Vision
RFG has big plans for Gloria Jean’s, which remains the cornerstone of its Café, Coffee, Bakery (CCB) segment. In the 12 months leading to June 28, 2024, the CCB segment contributed a significant 71% to RFG’s total sales of AU$504 million (US$332 million). Aside from Gloria Jean’s, the segment also includes the Donut King and Brumby’s Bakery brands, which collectively operate over 280 stores across the country.
Founded in the United States in 1979, the first Gloria Jean’s store opened in Australia in 1996. Retail Food Group acquired the chain for AU$163.5 million (US$105.3 million) in 2014 and has since expanded the brand’s reach. In addition to its Australian outlets, RFG operates more than 450 Gloria Jean’s stores in 30 international markets.
RFG’s acquisition of CIBO Espresso and its subsequent rebranding of the coffee chain’s stores reflects a continued focus on growing Gloria Jean’s presence both domestically and internationally. The move also signals a broader shift in the company’s strategic vision for the coming years.
RFG’s New Identity: Savora Brands Limited
In another significant development, RFG announced plans in August 2024 to change its corporate name to Savora Brands Limited. The company is poised to put the proposed name change before its shareholders at the upcoming Annual General Meeting (AGM) in November 2024. The name change is part of RFG’s broader efforts to rebrand and reposition itself within the competitive food and beverage market.
Under its new name, RFG aims to further strengthen its focus on its growing portfolio of food and beverage brands, including Gloria Jean’s, Donut King, and Brumby’s Bakery, as well as other key assets across Australia and internationally.
The Path Forward for RFG and Gloria Jean’s
The acquisition of CIBO Espresso is seen as a major step for RFG as it looks to capitalize on the growing demand for coffee and café-style experiences across Australia. By aligning CIBO’s well-established locations with the widely recognized Gloria Jean’s brand, RFG is positioning itself to capture a larger share of the Australian coffee market, particularly in regions where Gloria Jean’s presence is still emerging.
While the rebranding process is expected to take several years, RFG’s ambitious plan to expand Gloria Jean’s footprint in South Australia and beyond will likely have a significant impact on the competitive landscape for coffee chains in the country. With a growing customer base and a clear strategic direction, RFG’s Gloria Jean’s is well-poised to continue its upward trajectory in the coming years.
In summary, the acquisition of CIBO Espresso represents more than just a purchase of outlets; it is part of a larger, more strategic move to strengthen Gloria Jean’s and make it the dominant coffee destination in Australia and internationally. As the company moves forward with its plans for rebranding and expanding its presence, the ultimate success of this acquisition will likely depend on how effectively RFG can leverage CIBO’s established presence in South Australia to enhance Gloria Jean’s brand visibility and customer loyalty across the state.
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