Jacobs and Other Coffee Brands to Head a New U.S.-Listed Company

Keurig Dr Pepper (KDP) (owner of Keurig® and Dr Pepper) has entered into a definitive agreement to acquire JDE Peet’s (owner of Jacobs and a global portfolio of coffee brands) in an all-cash transaction, combining their complementary strengths in beverages and coffee.

The agreement values JDE Peet’s at €15.7 billion, with KDP offering €31.85 per share in cash, a 33% premium to JDE Peet’s 90-day average stock price. This acquisition marks a transformative step in KDP’s strategy, aimed at creating a global leader in coffee while driving long-term shareholder value.

KDP’s CEO stated, “Through the complementary combination of Keurig and JDE Peet’s, we are seizing an exceptional opportunity to create a global coffee giant. This is the right time for this transaction, with KDP in a position of operational and financial strength, momentum across our evolved portfolio, and increasing coffee category resilience. 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.”

According to the announcement, KDP expects the deal to deliver about $400 million in cost synergies over three years, with earnings accretion from year one. 

• Global Coffee Co. is set to generate $16 billion in annual sales, hold leading positions in 40 countries, and compete across all coffee categories. In a $400 billion global market, the company will benefit from strong profitability, cash generation, and innovation-led growth.
• Beverage Co., with over $11 billion in net sales, will compete in the $300 billion North American refreshment beverage market. Leveraging a diverse portfolio of iconic and emerging brands, a strong Direct-Store-Delivery system, and a capital-efficient growth model, it will be positioned to capture further market share. 

Both Global Coffee Co. and Beverage Co. will operate with focused strategies to maximise category leadership and deliver sustained shareholder returns.

After acquiring JDE Peet’s, Keurig Dr Pepper plans to separate into two independent, U.S.-listed publicly traded companies: Beverage Co., a scaled growth challenger in North America’s refreshment beverages market, and Global Coffee Co., the world’s #1 pure-play coffee company. 

What Does This Mean For Investors

The planned separation after JDE Peet’s acquisition may result in investors receiving shares in two newly listed entities, Global Coffee Co. and Beverage Co. This structure would allow them to participate directly in businesses with sharper strategic focus, tailored growth plans, and independent capital allocation priorities.

The deal is still contingent on customary pre-offer conditions. If finalized, shareholders would gain stakes in a leading global coffee powerhouse as well as a competitive North American beverage player - two distinct companies positioned to capture growth in their respective markets.

Sources – EasyResearch.

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