Avril had sales of 5.9 billion euros ($7 billion) in 2016 and already produces olive oil in France and Morocco.

But its flagship Puget brand is based on mixed-origin oil while Costa d'Oro sells premium products made solely from Italian oil.

"In the North American and Asian markets such as the Chinese one, it's Italian olive oil that sets the benchmark. It's a real prerequisite to target international markets," Avril spokesman Tom Doron said.

Financial details of the deal were not disclosed.

Family-controlled Costa d'Oro produced nearly 40,000 tonnes of olive oil in Italy with sales of 143.5 million euros ($171 million) in 2017, of which half was sold internationally. The brand is sold in more than 100 countries.

French wine, beer and soft drink group Castel also bought an undisclosed minority stake in Costa d'Oro as part of the same deal, Avril said.

The two French companies launched a vegetable oil joint venture in West Africa in 2013.

The global olive market was worth 12 billion euros in 2017 and is expected to grow by around 4 to 5 percent a year to reach 17 billion euros by 2025, driven by rising demand, notably in China and North America, Avril said.

The deal creates the world's third largest maker of branded olive oil after Spain's Deoleo and China's Bright Food [SHMNGA.UL].

Avril, controlled by French oilseed growers, also produces other oilseed-based products such as biodiesel and animal feed.

(Reporting by Sybille de La Hamaide; editing by Jason Neely)