Coffee Machine Maker Keurig To Be Sold For Almost $14B

NEW YORK (AP) — Keurig, the maker of single-cup coffee machine maker, said Monday that it has agreed to be sold to private equity firm JAB Holding Co. for almost $14 billion.

         Its shares rose more than 74 percent in premarket trading Monday.

         Keurig has been dealing with slowing sales of its machines and K-cups, the coffee-filled pods that are used in the coffee makers. Sales of K-cups, which accounted for more than 80 percent of Keurig revenue, rose 1 percent to $3.6 billion in the year ending September 26. Sales of its machines fell 23 percent to $632.6 million in the same period.

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         Its stock has suffered too, falling nearly 61 percent since the beginning of the year. In fact, the stock was the seventh-worst performing stock on the Standard & Poor's 500 index for the year.

         JAB Holding said it offered $92 for each share of Keurig, a 78 percent premium from the stock's closing price of $51.70 on Friday. Keurig's stock is down nearly 61 percent since the beginning of the year.

         Luxembourg-based JAB Holding already has a robust coffee empire. It has a controlling stake of Jacobs Douwe Egberts, the company behind Gevalia, Tassimo and other brands. It also has stakes in Peet's Coffee & Tea and Caribou Coffee. Outside of coffee beans, JAB Holding has a controlling stake of beauty company Coty and high-end shoe seller Jimmy Choo.

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         After the deal closes, which is expected to happen in the first quarter of next year, Keurig Green Mountain Inc. said it will remain headquartered in Waterbury, Vermont.

 

 

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