Keurig Dr Pepper will buy JDE Peet's, owner of Peet's Coffee, Douwe Egberts and Kenco, for $18 billion and then split into separate companies. One company will sell coffee brands and the other will sell cold beverages such as Snapple, Dr Pepper, 7UP and energy drinks. The move effectively unwinds the 2018 Keurig-Dr Pepper merger. The coffee unit's combined sales will be about $16 billion and the beverage unit about $11 billion. The companies expect approximately $400 million in savings over three years. JDE Peet's is based in Amsterdam and owns L'OR, Jacobs, Pilao, OldTown, Super and Moccona. The deal comes as consumers pull back and tariffs on Brazilian imports threaten higher coffee prices.
Keurig Dr Pepper will buy the owner of Peet's Coffee, Douwe Egberts and Kenco in an $18bn deal, then break itself in two, with one company selling coffee and the other selling cold beverages like Snapple, Dr Pepper, 7UP and energy drinks. The agreement announced Monday will essentially unwind the 2018 merger of Keurig and Dr Pepper and it arrives at a time when consumers are pulling back and the trade wars under Donald Trump threaten to send coffee prices soaring.
Trump imposed a 50% tariff this summer on most imports from Brazil the world's leading coffee producer for its investigation of its former president, Jair Bolsonaro, a Trump ally. Yet Keurig Dr Pepper sees coffee and cold beverages as areas of growth that would be better navigated by independently operating companies. CEO Tim Cofer called it a transformational moment for the sector.
By creating two sharply focused beverage companies with attractive and tailored growth propositions and capital allocation strategies, we are poised to generate significant shareholder value in both the near and long term, Cofer wrote in prepared remarks. But large chains like Starbucks are suffering. Same-store sales, a key barometer of a retailer's health, has fallen for six straight quarters at the Seattle coffee giant and its shares have tumbled 23% since early March.
Collection
[
|
...
]