Krispy Kreme being taken private in $1.35B deal
NEW YORK – Krispy Kreme shareholders are getting a caffeine boost after coffee giant JAB Beech said Monday it is acquiring the doughnut chain. JAB, which has controlling stakes in Keurig Green Mountain, Peet’s Coffee & Tea and Caribou Coffee, said it is taking the doughnut company private in a deal worth about $1.35 billion.
Krispy Kreme’s stock soared more than 24 percent in morning trading Monday.
Peter Harf, a senior partner at JAB, said the acquisition is part of the firm’s strategy of investing in brands with significant growth prospects. In addition to various coffee players, JAB also has a controlling stake in bagel chain operator Einstein Noah.
Unlike its much larger rival Dunkin’ Donuts, Krispy Kreme still gets most of its business from doughnuts and other pastries, rather than coffee drinks and sandwiches. But Krispy Kreme said it wants to step up its beverage sales.
The companies said Krispy Kreme will continue to be independently operated from its headquarters in Winston-Salem, N.C.. Krispy Kreme, which has more than 1,100 shops around the world, was founded in 1937.
Krispy Kreme has been looking to expand overseas. For its fiscal 2017, the chain said in March it planned to open about 120 to 140 new international locations, in addition to about 30 new shops domestically.
JAB Beech Inc. will pay $21 for each share of Krispy Kreme Doughnuts Inc. That’s about a 25 percent premium to the company’s Friday closing price of $16.86.
Krispy Kreme’s board unanimously approved the transaction, which is targeted to close in the third quarter.
The company said it will postpone its annual shareholders meeting, which was originally set for June 14.
Its shares are up 20 percent so far this year.