Keurig Dr Pepper to Split Beverage, Coffee Businesses Following JDE Peet’s Acquisition
Keurig Dr Pepper (KDP) is acquiring JDE Peet’s, a global coffee manufacturer, as part of efforts to restructure the company.
JDE Peet’s serves 100 markets with a portfolio of brands that includes Maxwell House, Peet’s, L’OR, Jacobs, Douwe Egberts, Kenco, Pilao, OldTown, Super, Moccona and others.
Following the close of this more than $18 billion transaction, KDP plans to split into two independent, U.S.-listed publicly traded companies: Beverage Co. and Global Coffee Co. The company’s goal is to create a “global coffee champion” and the “No. 1 pure-play coffee company.”
CEO Tim Cofer said the new coffee business will generate $16 billion in annual net sales.
Separation Details
Beverage Co. is predicted to yield several benefits, including rapid expansion into high-growth categories driven by “mega brands” such as Dr Pepper, Canada Dry, 7UP and A&W. Additionally, the company will look to expand its direct-store-delivery platform, supported by networks in the U.S. and Mexico.
Cofer will lead Beverage Co. as its CEO, and the business will be headquartered in Frisco, Texas.
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Meanwhile, Global Coffee Co. looks to combine KDP’s single-serve coffee leadership in North America with JDE’s global reach, helping to diversify product mix and elevate organic growth. Sudhanshu Priyadarshi will lead Global Coffee Co., but JDE's CEO Rafa Oliveira will stay on until the deal closes.
Through $400 million in expected cost synergies over the next three years, Global Coffee Co. will look to scale innovation across more brands and markets using a sophisticated supply chain with a global manufacturing footprint of 40-plus facilities.
Global Coffee Co. will be headquartered in Burlington, Mass., with the international headquarters in Amsterdam.
KDP expects to appoint additional leadership and board members for both companies at a later date.
“Today’s announcement marks a transformational moment in the beverage industry, as we build on KDP’s disruptive legacy by creating two winning companies, including a new global coffee champion,” said Cofer in a statement.
