EasyGroup confirms Coffee Republic interest

EasyGroup has confirmed it's interested in buying Coffee Republic for its property.

Coffee Republic has already received an approach from an unnamed third party and sandwich retailer Benjy's is also believed to be circling.

Caffe Nero has also kept investors guessing by building up a 10.7% stake in its rival - which insiders claim to be a strategic investment.

EasyGroup runs nine internet cafes in the UK and is keen to expand by setting up a franchise model based on smaller 100-seater outlets.

A group spokesman said Mr Haji-Ioannou had written to Coffee Republic asking for information about its property portfolio.

He said: "It's the retail premises that is of interest to us. But it could be Coffee Republic or it could be another retailer.

"The internet cafes have stemmed the losses back and gone on to break-even so the business is now ready to grow."

The coffee shop sector has suffered from intense competition as smaller firms jostle for position behind market leaders Starbucks and Costa Coffee.