U.S. beverage company Keurig Dr Pepper has agreed to acquire Dutch coffee giant JDE Peet’s for €15.7 billion ($18.4 billion) in an all-cash transaction. The deal, one of Europe’s largest acquisitions in over two years, aims to create a formidable global player in the coffee industry, better equipped to navigate growing supply chain challenges and trade tensions. Under the terms of the agreement, Keurig will offer €31.85 per share, representing a substantial 20% premium over JDE Peet’s closing price from last Friday.
The strategic move will see the merged entity split into two separate, publicly listed companies: a global coffee operation and a distinct beverage business. This structure is designed to allow each entity to focus on its specific market strengths. The newly formed Global Coffee Co., with approximately $16 billion in combined annual net sales, will leverage its scale to compete in the world’s $400 billion coffee market. Meanwhile, the Beverage Co., with over $11 billion in yearly net sales, will concentrate on the North American refreshment beverage market.
Market reaction to the announcement was immediate and divergent. Shares of JDE Peet’s surged by 18% in early trading, marking their strongest performance on record as investors welcomed the premium buyout offer. Conversely, shares of Keurig Dr Pepper fell 1.3% in Frankfurt, reflecting the market’s initial assessment of the deal’s cost and execution risk. The transaction partially reverses the 2018 merger that created Keurig Dr Pepper, signaling a major reshaping of the company’s strategy.
The acquisition comes at a time of significant volatility in the global coffee market, where prices have reached historical highs due to unpredictable weather impacting supply and recent trade policies. Both companies have previously noted the pressure from high coffee bean costs, which are expected to rise further after the recent imposition of tariffs. Keurig Dr Pepper’s CEO, Tim Cofer, stated the company is in a “position of operational and financial strength” and called the deal an “exceptional opportunity to create a global coffee giant,” with the new entities to be led by the existing executive team.
