Starbucks finally getting real competition?
Joh A. Benckiser is buying Caribou Coffee for $340 million in its second acquisition of a US specialty coffee maker after snapping up Peet's.
Joh A. Benckiser, a German-Austrian consumer-products company, said Monday it has agreed to buy Caribou Coffee (CBOU) for $16 a share, or $340 million. The price is a 30% premium to Friday's closing price of $12.32.
But investors are betting the price may be sweetened. Caribou shares were trading at $16.01 Monday afternoon. It had traded as high as $16.64. Starbucks was up $1.15 to $54.51.
The deal seems to be establishing a pattern. This summer, Benckiser and merchant-banker BDT Partners of Chicago bought Peet's Coffee & Tea, the California specialty coffee roaster, for about $1 billion. And it has a minority stake in D.E Master Blenders 1753, a Dutch-based coffee and tea company.
We asked the company if it had aspirations for taking on Starbucks, the global coffee giant. A spokeswoman said the company wouldn't comment.
Caribou is the nation's second-largest coffee-shop operator -- but a long second -- after Starbucks. As of Sept. 30, the Minneapolis company had 610 coffee houses, including 202 franchised stores, in 22 states, the District of Columbia and 10 foreign countries. It also sells coffees in supermarkets, warehouse stores, hotels and the like.
Caribou had the potential of emerging as a strong regional competitor to Starbucks, as I noted in "3 contenders for the next Starbucks." The other contenders were Dunkin' Brands (DNKN) and Panera Bread (PNRA).
Benckiser is a holding company founded in 1823 to sell chemicals in Europe. Starting in the 1950s, the German company started moving into consumer businesses. It owns 80% of Coty, the cosmetics maker; and Jimmy Choo, maker of sleek women’s shoes. The company owns 15% of Reckitt Benckiser (RGBPY), the British household products giant, whose brands include Lysol, Calgon water softeners and French's Mustard.
Now based in Vienna, Joh. A. Benckiser is owned by four members of the Reimann family, who have has controlled Benckiser since 1858. Their combined net worth is at least $20 billion, according to Bloomberg News. The company is led by CEO Peter Harf.
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