Subsidiary Companies


Chock Full o' Nuts Corporation

Sol Cafe Ltd

Sol Tenco Ltd

In 1964 J. Lyons & Co acquired an interest in the Chock Full o' Nuts Corporation in USA from the Beechnut Company. In July 1964 this operation decided to acquire three other coffee blenders: the Old Judge Coffee Company (based in St Louis, Missouri), Nash's (in St Paul, Minnesota, and Boscul (in Camden, New Jersey). With these acquisitions Chock Full o' Nuts now traded in a total of 30 American states. Old Judge had the highest coffee sales in the St Louis area. On 1 April 1965 Lyons and Chock Full o' Nuts formed a new company Sol Cafe Limited, with an issued equity capital of £1000,000 with Lyons holding the controlling shares. On 2 July 1969 the Chock Full o' Nuts shareholding was bought by Lyons and thus Sol Cafe Limited became a wholly-owned subsidiary of J. Lyons & Co. The company concentrated on instant coffee in the UK and became one of the major suppliers to supermarkets under their own labels.

By 1970 Lyons had captured 80 per cent of the UK market in private-label instant coffee, which itself comprised 20 per cent of the whole instant coffee market in the UK.

In March 1982 Lyons acquired from the Coca-Cola Company of Atlanta the issued share capital of Ibenco (Great Britain) Ltd, subsequently named Tenco (UK) Ltd. With headquarters in Linden, New Jersey, the Tenco Division reported to the Coca-Cola Foods Division and had manufacturing, warehousing and distribution facilities at six locations in North America. It was the largest supplier of private-label instant coffee and tea in the United States and had one of only four factories producing high-margin decaffeinated coffee. The Tenco Division of the Coca-Cola Company (UK branch) was managed by Charles Druce, who continued as managing director of Tenco (UK) Ltd. An uncomplicated business, Tenco purchased spray-dried coffee powder from countries of origin and packaged it in jars and cartons (labelled in accordance with customers' requirements) from an unpretentious factory in Ilderton Road, Peckham. Spray-dried powder was sometimes agglomerated by moistening a falling curtain of milled powder with steam, then drying it so that it stuck together in lumps. The linchpin of Tenco UK's operation was the exclusive supply of packaged coffee to the Co-operative Wholesale Society, a contract which had existed since the late 1960s and which accounted for 60 per cent of packaging volume (the Peckham factory also packed and sold a non-dairy creamer which was supplied by Premier Brands Ltd).

By now there was a growing demand from principal private-label customers for better products, generally in the image of Nescafe coffees. Sol Cafe had built up a processing capability over several years and, although the firm tended to buy coffee powder, in the years immediately before the Tenco acquisition the basic equipment and expertise were retained at Greenford. Techniques developed by Sol Cafe increasingly produced soluble coffees at least equal to the brand leaders; this enabled the company to expand its market share to about 18 per cent by 1984. Instant coffee production was supported by a vastly improved packaging facility at Greenford. One of the benefits of acquiring Tenco UK was the injection of capital plant into the production area at an economic cost and over a short time-scale. For example, one renovated fast jar-filling line was commissioned at Greenford in 1982 at a cost of £500,000. It was supplemented by two further lines from the Tenco site at Peckham in mid-1982. Acquisition of these lines and other plant made the operation flexible enough to handle packaging orders within a single-shift working pattern. There were associated cuts in the workforce within the production area, with no loss of output; and direct packaging labour per unit of throughput was reduced by 40 per cent.

Sol-Tenco's instant coffee trade continued to lie mainly in own-label products, but small amounts of its Gold Roast brand were sold through 'cash and carry' outlets. Green coffee was bought from European Community traders or from representatives of traders in the country of origin. Ready-made spray-dried or powdered coffee was also bought from Brazil, Columbia, India and Salvador. Decaffeinated beans for instant coffee manufacture were obtained from France or Germany by a German company, Coffein Compagnie. Sol-Tenco also bought small quantities of decaffeinated coffee powder from Brazil and supplies of freeze-dried coffee from Germany.

By February 1994, after Allied-Lyons had acquired the Pedro Domecq sherry group the instant coffee business had fallen to 11 per cent of the UK market and it was sold to Kraft Jacobs Suchard, part of the Philip Morris empire.



 © Peter Bird 2004