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the US food giant, for $30 million.

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| July 01, 2004 | COPYRIGHT 2004 Financial Times Ltd. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan.  All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)Copyright

(From Arabies Trends)

The story dates back to the 1950s, when the young Mustapha Gaouar, the Algerian heir to a coffee dynasty created in 1860, decided to move to Morocco. In less than a decade, Casablanca, the country's commercial capital, was at his feet. He bought the Toraf coffee brand, and then acquired the Mundial brand in 1973, both of which helped him expand his profit margins.

To strengthen his position, Gaouar diversified his suppliers by bagging exclusive import contracts with Cote d'Ivoire and Brazil. This allowed him to increase his stock of coffee at cut-rate prices. Then, in 1980, Gaouar introduced vacuum packaging to Morocco. As a result, Gaouar coffee quickly became the market leader.

The brand's success inspired Gaouar to expand into neighboring countries. In 1981, he quietly laid the foundations for expansion after carrying out market and feasibility studies. But on the eve of the expansion of his company, named Ennasr, Gaouar was diagnosed with diabetes. He decided at that point to leave his business on the back burner and focus on his health. That's when two of his friends offered to help him out. One of them, an accountant named Omar Berrada, was to become the source of all the Gaouar family's troubles.

Friends in need. By giving up 50 percent of his industrial capital to his two "friends" for just 750,000 dirhams ($83,000), Mustapha Gaouar thought he was saving the family business. His two associates became part of the two Gaouar companies: Promocaf, which sold coffee, and Ennasr, which roasted it. Berrada also bought the share of a third partner, further consolidating his influence.

In less than two years, cracks started to appear. While Promocaf performed well, Ennasr posted losses for the first time. So Gaouar decided to give Ennasr to Berrada. This proved a huge mistake. In return for Ennasr, Gaouar demanded that the company buy raw coffee from Promocaf - to ensure the latter's survival, he told his children.

From 1982-85, Berrada did not honor this agreement. After consulting his lawyers, Gaouar started roasting coffee again under the aegis of Promocaf. So Berrada, his former friend, sued him. Until that point, it seemed to be just an ordinary business dispute. Unfortunately for the Algerian family that had decided to make Morocco its home, however, the judges transferred the case to criminal court - an inexplicable move with no legal precedent.

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