February 14, 2019 / 4:43 PM / 6 months ago

Germany's JAB plans to list unit owning Keurig, Dr Pepper

LONDON/BERLIN (Reuters) - Family owned JAB Holding Co, which has several coffee and restaurant brands is planning to list the business that owns Keurig, Dr Pepper, Peet’s Coffee and JDE coffee brands, the company said on Thursday.

“JAB has a very successful global Coffee and Beverages platform in Acorn, and we are envisioning taking it public in the next two-three years,” JAB said in an emailed statement.

Its Acorn Holdings Unit is one of the company’s largest, having acquired Dr Pepper Snapple last year in one of the most prominent consumer deals of 2018.

The business also includes brands such as Jacobs, Douwe Egberts, Tassimo, Gevalia, L’Or, Pilao and Kenco.

“A public listing would be in line with JAB’s long-term philosophy to bring leading global consumer businesses to the public markets. However, we have not made any decision to trigger an IPO process now,” the statement added.

The news comes after Germany’s Lebensmittel Zeitung reported on Thursday that the company was mulling two initial public offerings in the next two to three years, but did not specify the brands under consideration.

“We want to bring both companies to the stock exchange separately in the next two to three years,” JAB chairman Peter Harf told the trade journal in an interview.

The newspaper said the IPOs would generate billions of euros for the Reimanns, who have built a coffee empire over the past five years, seeking to take on market leader Nestle.

The Acorn Holdings unit does not include other JAB-owned restaurant chains including Pret a Manger, Krispy Kreme and Einstein Bros Bagels. It is also separate from its ownership of Coty and Bally.

Public offerings “may free up their capital position to do more deals,” said Liberum analyst Robert Waldschmidt.

Last year, JAB’s deals included buying a majority stake in British sandwich chain Pret a Manger for $2 billion, and the combination, worth more than $21 billion, of its Keurig coffee business and a publicly-traded soft drinks company to create Keurig Dr Pepper.

The marriage of Keurig with Dr Pepper Snapple set the stage for further potential expansion into soft drinks, which JAB pointed to in an interview last year.

“The read across for Nestle is good, as there will be more transparency and visibility on the market,” said Vontobel analyst Jean-Philippe Berstchy. “It might mean more consolidation ahead, but perhaps more rational discipline from the competition.”

Lebensmittel Zeitung on Thursday said the coffee business, including Keurig Dr Pepper, had annual sales of $19 billion, while the restaurant business including Pret a Manger had turnover of $5.7 billion.

Earlier this week, JAB laid out plans to lift its stake in cosmetics maker Coty Inc, where it’s already the largest shareholder, to 60 percent with a tender offer that could be worth as much as $1.75 billion.

JAB itself is also at a crossroads, with this year’s departure of its chairman, consumer goods veteran Bart Becht.

Becht - former CEO of Reckitt Benckiser, a firm to which the Reimanns trace their fortune - was one of the founding principals of JAB, along with Peter Harf and Olivier Goudet.

The Reimanns are Germany’s second-richest family with a net worth of about 33 billion euros, according to Manager Magazin.

Reporting by Emma Thomasson and Martinne Geller; additional reporting by Harry Brumpton; editing by Alexandra Hudson and Elaine Hardcastle

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