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Coffee group Keurig Green Mountain to buy Dr Pepper Snapple

European investment fund JAB Holding is to become the controlling shareholder of Keurig Dr Pepper

Speciality coffee company Keurig Green Mountain has bought soft drink maker Dr Pepper Snapple Group in a US$18.7bn deal.

The new beverage giant, named Keurig Dr Pepper, will gather well-known brands such as Dr Pepper, Orangina, and Schweppes with Green Mountain Coffee Roasters. 

Keurig Dr Pepper will have a combined annual revenue US$11bn after what will be one of the largest beverage deals in years.

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“Our view of the industry through the lens of consumer needs, versus traditional manufacturer-defined segments, unlocks the opportunity to combine hot and cold beverages and create a platform to increase exposure to high-growth formats,” said Bob Gamgort, Keurig’s CEO. 

 “The combination of Dr Pepper Snapple and Keurig will create a new scale beverage company which addresses today’s consumer needs.”

Through the agreement, Dr Pepper Snapple shareholders will retain 13% of the combined company and will also receive $103.75 per share in a special cash dividend.

The firms said that the merger would enable Keurig Dr Pepper to have "unrivalled distribution capability to reach virtually every point-of-sale in North America".

US-based Keurig Green Mountain is owned by private equity firm JAB Holding and is best known for its single-serve brewing machines and coffee pods.