Starbucks may face stronger competition after Peet's merger
Peet's Coffee is joining forces with a Dutch-based beverage company to explore an initial public offering
Is a new threat to Starbucks on the horizon?
Peet's Coffee is merging with Netherlands-based beverage company Jacobs Douwe Egberts to explore an initial public offering, both companies announced.
The new company, which will go by JDE Peet's, will be available in over 140 countries with revenues of approximately $7.8 billion.
Jacobs Douwe Egberts already has 39 coffee brands in its portfolio from longtime favorite Maxwell House to single-cup brewer Tassimo. Peet's has more than 200 retail locations in 10 states -- California, Virginia, Tennessee, Nevada, Washington, Oregon, Colorado, Illinois, Massachusetts and Maryland -- and Washington, D.C. Starbucks, by comparison, has more than 31,000 brick-and-mortar stores, but an IPO for the new company could fuel an expansion in 2020.
The IPO exploration has also caused a bit of a shakeup in terms of executive personnel, with Peet's Coffee CEO Casey Keller to become CEO of JDE Peet's in January 2020. Meanwhile, Frederic Larmuseau, the president of Jacobs Douwe Egberts, will be stepping down from his role and will remain on staff as a special advisor to the board and CEO, according to Wednesday's press release.
Both company's lauded the personnel changes and merger as a step toward a successful IPO.
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"We are excited that Casey will assume the role as CEO of JDE Peet's as we continue further building upon the company's strong track record of growth and expansion," Olivier Goudet, chairman of JDE and Chairman of Peet's Coffee, said in the release. "We are proud of what we have accomplished at JDE and Peet's but believe with our IPO the best years of growth and shareholder value creation are ahead of us with our newly combined company. I want to thank Frederic for his stewardship in driving JDE's growth and development."
Meanwhile, the combined company's new CEO Casey Keller was equally as enthusiastic over the move as they look toward their "next phase of growth."
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"JDE Peet's is an exceptional business with some of the most beloved coffee brands in the world, and I am excited to lead the company in its next phase of growth," Keller said of the merger and planned IPO. "With our leading positions in many important markets, supported by all the great people in our organization, we are well-positioned to continue achieving strong long-term growth."
Prior to his role as CEO at Peet's Coffee which he's held since 2018, Keller held leadership positions at Heinz, Mars Wrigley, P&G and Alberto Culver, the press release states.
Peet's and JDE are both owned by the German family-owned investment group JAB, which also has majority stakes in donut maker Krispy Kreme and Einstein Brothers Bagels among other food and drink brands.
Peet's bills itself as America's "original craft coffee" because it opened for business years before Starbucks. Peet's was founded in Berkeley, California, in 1966 five years before Starbucks opened its first store in Seattle.