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MONTVALE, N.J. -- A&P has officially put its venerable Eight O' Clock coffee business on the block, in an effort to raise needed cash to pay down its $1 billion debt load, according to an article in today's Star-Ledger newspaper.
The business includes the Eight O' Clock, Bokar, and Red Circle brands, and a coffee roasting plant in Landover, Md. Sources close to the company say A&P is asking between $150 million and $250 million, but some observers believe the business is worth about $100 million.
Sara Lee, which owns Chock full O' Nuts, smaller coffee roasters, a European business, and private investor groups are said to be possible bidders.
One of America's icon brands, Eight O' Clock was established in the late 1800s and named Eight O' Clock was established in the late 1800s and named Eight O' Clock because company founder George Huntington Hartford believed most people drank their coffee at 8:00 a.m. At one time the company operated 23 roasting plants and the large red grinders at the checkout counters filled A&P stores with the aroma of coffee.
In addition to its own stores, A&P sells Eight O' Clock coffee through other stores in markets where it no longer operates. Sales last year were about $97 million, up from $93 million in 1999, and the brand is the leading whole bean coffee sold in supermarkets, drug stores, and mass merchandisers, although whole bean offerings from Starbucks are gaining fast.