Keurig Dr. Pepper to purchase Peet's Coffee in $18B deal

Keurig Dr Pepper said Monday it will buy Peet’s Coffee owner JDE Peet’s in a deal worth about $18 billion.

When the acquisition is complete, the company plans to split into two separate companies, one focused on coffee and the other focused on beverages including Dr Pepper, Canada Dry, 7Up and energy drinks.

The coffee business will have about $16 billion in combined sales and the beverage business about $11 billion.

The latest deal unwinds a 2018 tie-up that merged Dr Pepper and Keurig. That deal was meant to create a beverage giant with the capacity to distribute hot and cold drinks to customers, while saving money.

Analysts questioned the wisdom of that at the time, and while the company’s beverage unit has thrived, its coffee segment has struggled.

In the past several years, the coffee industry has slowed significantly, amid surging coffee bean prices, softening demand and stiff competition from cheaper store brands. As a result, the coffee business has become a drag for Keurig Dr Pepper.



AP Photo/Richard Drew, File