Diedrich stock soared 28% to $33.15 in premarket trading Monday, according to a report in The Wall Street Journal, indicating investors think bidding on the company may go higher.
The Green Mountain offer was first announced Monday by Peet and Diedrich in separate releases. Diedrich [image-nocss] said its board is reviewing both proposals, according to the newspaper report.
Earlier this month, Peet's agreed to pay $26 a share for Diedrich in a deal that would allow Peet's to enter the rapidly growing market for single-cup packets used in coffee machines.
In the new proposal, Peet's would pay a combination of $19.80 a share in cash and 0.321 share of Peet's for each share of Diedrich common stock. Green Mountain's offer is all cash.
"We are confident that the Diedrich board will find our revised proposal to be superior for Diedrich's shareholders," Peet's CEO Patrick O'Dea said Monday.
"We believe our offer provides Diedrich shareholders with a substantial all-cash premium as well as greater value and greater certainty than the cash and stock proposal from Peet's," said Green Mountain CEO Lawrence J. Blanford. Green Mountain would finance its bid with cash on hand and existing bank lines of credit.
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