Dive Brief:
- An investor group headed by private equity firm JAB Holding Co. is buying Keurig Green Mountain for $13.9 billion, valuing it at $92 per share.
- JAB's purchase of Keurig is in conjunction with strategic minority investors that also are shareholders in Jacobs Douwe Egberts B.V. — including Mondelez International.
- The transaction is expected to close in Q1 2016.
Dive Insight:
Coca-Cola — which has a 17% stake in Keurig — was in favor of the deal. Keurig's board gave it the OK unanimously.
Keurig has been struggling with dipping sales. Q4 revenue fell 13% to $1.04 billion, and single-serve coffee pods had revenue dip 9%. Net profit fell 33%. Despite all this, the company's stock went up 20% on these results, profit projections and that the company would increase its dividend as of Feb. 16 13% to $1.30.
This year, Keurig's shares dipped more than 60% in value.
Keurig has been hoping its new device the Keurig Kold performs well, though its high price hasn't made analysts too confident.
JAB's senior partners are known for purchasing consumer goods and fashion companies, with holdings like Peet's Coffee & Tea and Jimmy Choo Ltd.
