(Bloomberg) -- Coffee roaster Luigi Lavazza SpA agreed to buy vending machine maker IVS Group after launching a cash offer for the Italian company along with its majority shareholder, sending IVS shares soaring at the opening in Milan.

Lavazza will pay €7.15 ($7.61) per share with a plan to delist the company, according to a filing late Monday. The price corresponds to a premium of 11% based on Monday’s closing price and sets a valuation on IVS at €651.5 million, according to Bloomberg calculations. IVS gained as much as 11.2% in early trading on Tuesday. 

With the deal, Lavazza plans to expand IVS’s business, and the firm already has a significant presence in the European Union and Italy, the company said in a statement, adding that it should also strengthen the coffee maker’s presence in the fragmented vending machine market.

Lavazza Chief Executive Officer Antonio Baravalle has signaled his openness to acquisitions as the roaster looks to build scale, and the CEO said in the statement that the IVS deal’s structure will help his group “compete with the other major coffee players at an international level.”

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On completion of the deal, IVS’ majority shareholder IVS Partecipazioni will indirectly hold a majority stake in the company, with Lavazza indirectly between 39% and 49%. Lavazza will then have the option to acquire full control starting from 2027, according to the statement.

(Updates with shares in second paragraph.)

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