WINSTON-SALEM, N.C. -- Krispy Kreme Doughnuts Inc. and JAB Beech Inc. have entered into a definitive merger agreement under which JAB Beech will acquire Krispy Kreme for $21 per share in cash, or approximately $1.35 billion.
JAB Holding, parent company of JAB Beech, is a Germany-based privately held group focused on long-term investments in companies with premium brands, attractive growth and strong margin dynamics in the consumer goods category.
Its portfolio includes controlling stakes in Keurig Green Mountain, a leader in single-serve coffee and beverage technologies, and Jacobs Douwe Egberts (JDE), the largest pure-play fast-moving consumer goods (FMCG) coffee company in the world, among other companies. JAB also has controlling stakes in Peet's Coffee & Tea, a specialty coffee and tea company; Caribou Coffee Co., a specialty retailer of premium coffee products; Einstein Noah Restaurant Group Inc., a quick-casual restaurant; and Espresso House, the largest branded coffee-shop chain in Scandinavia, among others.
The deal, which has been unanimously approved by Krispy Kreme’s board of directors, represents a premium of approximately 25% over the company’s closing stock price on May 6, 2016.
At the close of the transaction, Krispy Kreme will be privately owned and will continue to be independently operated from Krispy Kreme’s headquarters in Winston-Salem, N.C.
Krispy Kreme has been an iconic brand for nearly 80 years, said chairman Jim Morgan. This transaction puts it in the “best possible position” to deliver value to Krispy Kreme shareholders. “I am confident the JAB team is the right partner with whom to continue building upon our incredible legacy,” he said.
“JAB’s experience and industry knowledge make them the ideal partner to help grow the iconic Krispy Kreme brand throughout the world,” said Tony Thompson, CEO of Krispy Kreme. “We remain focused on our long-term strategy and continuing to offer our premium, high-quality doughnuts and sweet treats to consumers around the world. We look forward to working with JAB to continue bringing the joy that is Krispy Kreme to a growing number of customers. Together with our talented team and our passionate franchisees, we will continue to build on the Krispy Kreme culture, values and commitment to our customers and guests.”
Peter Harf, senior partner at JAB, said, “We are thrilled to have such an iconic brand as Krispy Kreme joining the JAB portfolio. This is yet another example of our commitment to investing in extraordinary brands with significant growth prospects. We feel strongly that Krispy Kreme will benefit greatly from our long-term focus and support for management’s vision in building on the legacy of this exciting brand as an independent stand-alone entity.”
The transaction is not subject to a financing condition, and the companies said they expect the deal to close in the third quarter, subject to customary closing conditions, including receipt of regulatory and shareholder approvals.
Founded in 1937, Krispy Kreme is a leading branded specialty retailer and wholesaler of sweet treats and complementary products, including its signature Original Glazed doughnut. It operates more than 1,100 shops in more than 26 countries around the world.
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