Taking a jab at the donut industry
European investment fund, JAB Holding Co., will acquire popular donut chain Krispy Kreme for approximately $1.35 billion, the company announced Monday. JAB is the investment fund of the wealthy German Reimann family. JAB stands for Joh A. Benckiser, the patriarch of the Reimann family who made billions by buying up consumer goods companies.
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.”
They own basically everything already
For JAB, breakfast is truly the most important meal of the day. While the company owns a variety of different consumer goods companies, such as Jimmy Choo shoes, Durex condoms, and Coty cosmetics, most of its holdings are breakfast restaurants and coffee shops and roasters. Krispy Kreme will join a portfolio that includes Einstein Brother’s Bagels, Caribou Coffee, Peet’s Coffee & Tea, and Stumptown Coffee Roasters. Last December, JAB also acquired coffee roaster Keurig Green Mountain for 1.39 billion.
Because JAB already has expertise when it comes to coffee and breakfast, Will Slaubag, analyst at Stephens investment bank, calls JAB a “near-ideal candidate” to acquire Krispy Kreme. JAB will be able to help Krispy Kreme add menu items, expand nationally and internationally, and compete with other fast food chains, who are making big bucks and drawing away customers with their breakfast menus.
Another company, BDT Capital Partners, will also hold a minority stake in Krispy Kreme.
Going private
Krispy Kreme, which was founded almost 80 years ago, will continue to be independently operated from its headquarters in Winston-Salem, North Carolina. The company will no longer be traded in public markets.
The transaction is still awaiting shareholder approval; the deal will likely be signed at the close of the third quarter.
#DasKrispyKreme
