TORONTO (Reuters) - Gabe Tsampalieros, the chairman of Canada'''''s Second Cup coffee-shop chain, is buying the company from Cara Operations Ltd. for an undisclosed sum.
Under the proposed deal, Tsampalieros -- who has also served as Cara's chief executive -- will buy all shares of The Second Cup Ltd., but not the units of the Second Cup Royalty Income Fund currently held in Second Cup. He's also buying all international Second Cup trademarks held by Cara that were not transferred to the income fund when it went public in late 2004.
The income fund has no ownership stake in Second Cup, but its indirect source of revenue is the royalties it collects through an agreement with the coffee shop chain.
Second Cup is Canada's second largest retailer of specialty coffee, as measured by the number of cafes. After the deal, Cara will continue to operate a number of Second Cup cafes as franchisee, under currently existing agreements.
In a statement, Tsampalieros called the deal a "win-win" for both Second Cup and Cara, which went private in early 2004.
David Bloom, the chairman of the board of trustees of the income fund, said, "We look forward to continuing to work with Mr. Tsampalieros in his new capacity as owner."
The deal is expected to close by the end of the year.