The Costa Coffee chain operator Whitbread is in advanced talks regarding a possible acquisition of the coffee shop operator Coffeeheaven for about £32 million.

Both, Whitbread and Coffeeheaven have confirmed that they were pursuing talks over a 24p-a-share offer.

Whitbread has 1,000 Costa Coffee shops in Britain along with 400 overseas. It is looking for further expansion.

Coffeeheaven, which announced in June that it had initiated a strategic review to take advantage of acquisition opportunities, runs as many as 90 coffee shops in Slovakia, Latvia, Poland, Bulgaria and the Czech Republic.

Earlier in September, Coffeeheaven posted a loss of £185,000 for the full-year as recent economic crisis hit its second largest market the Czech Republic hard.

But, previous month it reported a pre-tax profit of £238,000 for the six-month period ended September 30.

Shares in Whitbread gained 40 pence to £13.30, while shares in Coffeeheaven climbed 2¾ pence to 22½ pence.