Specialty coffee retailer Keurig Green Mountain Inc. ( GMCR ) is enhancing the Keurig single-cup brewing system through technological innovations in order to remain competitive, especially after its K-Cup patents expired in Sep 2012. In this regard, the company's Canadian subsidiary - Keurig Canada - partnered with Italian coffee company, Luigi Lavazza SpA, to launch the Keurig Rivo Espresso, Cappuccino and Latte system in Canada.
The brewer uses Rivo packs and has the ability to brew hot or iced cappuccinos, lattes and mochas within a minute.The machine offers almost 32 espresso-based beverage options. The machine can also froth milk for making espresso and cappuccinos at homes. Each Rivo pack contains approximately 7.5 grams of 100% Arabica beans.
The current agreement extends a prior partnership between Keurig Green Mountain and Luigi Lavazza SpA signed in 2012. Under the deal, the two companies developed the Keurig Rivo Cappuccino and Latte System which marked the former's entry into the growing category of espresso, cappuccino and latte brewers.
The Rivo Systems launched during 2012 were sold only at select Bloomingdales stores until Mar 2013 when the brewers were made available at other retail stores as well. The current partnership will bring the brewer to Canada for the first time which will be available on the official website of Keurig Canada at a proposed price of $229.99.
The deal will boost Lavazza's coffee sales as the convenience of Keurig brewers will enhance the popularity of its beverage among Keurig fans. Moreover, the pact furthers Keurig Green Mountain's goal of sustaining its dominance in the single-serve brewing market after the K-cup patents expired.
Green Mountain offers coffees, teas and other hot beverages in K-Cup and Vue portion packs. These portion packs can be used on its single-serve Keurig brewers for making hot beverages.
The Zacks Rank # 3 (Hold) company aims to popularize the single-cup brewing system in America through strategic distribution agreements and has roped in popular brands like Dunkin' Brands Group Inc. ( DNKN ), Starbucks Corp. ( SBUX ) and Unilever plc ( UL ) into its portion pack systems.DUNKIN BRANDS (DNKN): Free Stock Analysis ReportKEURIG GREEN MT (GMCR): Free Stock Analysis ReportSTARBUCKS CORP (SBUX): Free Stock Analysis ReportUNILEVER PLC (UL): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research