Olam Intends to Buy Taloca

NEW YORK - Aug 18/06 - SNS -- Olam International Limited has signed a letter of intent to buy Taloca & Compania Limitada (TAB), a subsidiary of Kraft Foods International, green coffee processing unit in Colombia.

Olam is considered the world's largest originator and supplier of Robusta coffee. In the recent months, the company has been getting more involved with Arabica coffee.

The Arabica coffee market size at 4.6 million tons valued at US$10.8 billion is approximately 3.4 times the size of the Robusta coffee opportunity (2.5 million tons valued at US$3.2 billion).

TAB has a processing capacity of 21,000 tons of processed green coffee per year. At full capacity, this facility will generate revenues of US$52 million at current prices. Olam intends to enhance this current capacity further to 30,000 tons (with estimated revenues of US$74 million) by making marginal additional capital investment in the next 2 years.