Keurig plans to purchase Dr Pepper Snapple Group for USD 18.7 billion
Category: #world  By Saipriya Iyer  Date: 2018-01-31
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Keurig plans to purchase Dr Pepper Snapple Group for USD 18.7 billion

JAB Holding Company, an investment firm that funds the coffee business of Keurig Green Mountain Inc. has decided to acquire Dr Pepper Snapple Group Inc. for USD 18.7 billion. JAB’s move to take over the soft drink business of Pepper as a part of its new plan for rapidly expanding across the emerging food & beverages sector has been deemed to be quite lucrative, as per analysts.

As a part of the purchase agreement, Dr Pepper’s stockholders are likely to receive USD 103.75 per share in the form of the special cash dividend.  Dr Pepper will also retain 13% of the ownership in the joint venture referred as Keurig Dr Pepper, while Keurig Green Mountain will acquire 87% of the ownership.

The prospective deal will apparently place JAB in direct competition with giant soft drink manufacturers such as PepsiCo Inc., Coca-Cola, 7 Up, Mott Apple Juice, and A&W Root Beer. Keurig Dr Pepper, the combined business entity, is anticipated to generate a yearly revenue of nearly USD 11 billion in the years ahead. With Dr Pepper manufacturing fast-emerging beverages such as Bai Brands and consumers increasing their preference for new soft drinks, the combined firm has been forecast can derive substantial revenue in the ensuing years.

Reports claim that Keurig contributed nearly 7.4 % towards U.S. coffee industry share last year, while Dr Pepper captured approximately 8.5% of the soft drinks market share during the same span. With the acquisition pact between the two reputed firms expected to be finalized in the next quarter of 2018, it is likely that the joint business unit will witness a significant rise in its market share.

Sources state that the deal is currently awaiting the approval from Dr Pepper’s investors as well as regulatory authorities.



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Saipriya Iyer

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Saipriya Iyer

Saipriya Iyer develops content for Market Size Forecasters, Algosonline, and myriad other platforms. A computer engineer by profession, she ventured into the field of writing for the love of playing with words. Having had a previous experience of 3 years under her bel...

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