JAB Holdings pays US$13.9 billion for Keurig Green Mountain

JAB Holding Company announced its plan today to purchase Keurig Green Mountain for US$13.9 billion. The companies have entered into a merger agreement under which a JAB-led investor group will acquire Keurig for US$92.0 per share in cash, or a total equity value of approximately US$13.9 billion. JAB is acquiring Keurig in partnership with a number of investors that also own shares in Jacobs Douwe Egberts (JDE) entities. JDE is the love child of D.E Master Blenders 1753 and Mondelēz International, created when the two companies merged their coffee businesses earlier this year. At the close of the transaction, Keurig Green Mountain will be privately owned and will continue to be operated independently from its headquarters in Vermont, United States. “This transaction will deliver significant cash value for our shareholders and offers an exciting new chapter for our customers, partners and employees by combining Keurig Green Mountain with JAB’s global coffee platform,” said Keurig, President and CEO Brian Kelley, in a statement. “JAB fully supports Keurig Green Mountain’s culture and values as we continue to pursue our commitment to deliver innovative beverage solutions.” Despite an effort to delve into a new territory with its cold brew pod range, Keurig stocks have suffered this year, down 61 per cent before Monday’s announcement. Coca-Cola Company Chairman and CEO Muhtar Kent said The Coca-Cola Company, which owns about 17 per cent of Keurig, fully supports the decision. “We have enjoyed a strong partnership with Keurig Green Mountain, and will continue our collaboration with JAB in order to capitalise on the growth opportunities in the single-serve, pod-based segment of the cold beverage industry,” said Kent. “We look forward to working with JAB, an experienced operator with a successful track record of investing in and growing consumer companies.” JAB Holding Company is a privately held investment firm based in Luxembourg that manages the fortune of Germany’s Reimann family. Its portfolio includes a controlling stake of JDE, Peet’s Coffee & Tea, which brought Stumptown Coffee Roasters and Intelligentsia this year, Caribou Coffee, Einstein Noah Restaurant Group, Espresso House and Baresso Coffee. The transaction is expected to close during the first quarter of 2016.