Krispy Kreme Doughnuts, Inc. and JAB Beech Inc., an indirect controlled subsidiary of JAB Holding Company today announced that the companies have entered into a definitive merger agreement under which JAB Beech will acquire Krispy Kreme for $21 per share in cash, or a total equity value of approximately $1.35 billion. The agreement, which has been unanimously approved by the company’s Board of Directors, represents a premium of approximately 25% over the Company’s closing stock price on May 6, 2016.
At the close of the transaction, Krispy Kreme will be privately owned and will continue to be independently operated from their current headquarters in Winston-Salem, N.C.
Jim Morgan, Chairman of the Board of Directors of Krispy Kreme, commented, “For nearly 80 years, our iconic brand has been touching and enhancing lives through the joy that is Krispy Kreme. This transaction puts us in the best possible position to continue to spread that joy to a growing number of people around the world while delivering significant value to Krispy Kreme shareholders. I am confident the JAB team is the right partner with whom to continue building upon our incredible legacy.”
Tony Thompson, CEO of Krispy Kreme, commented, “JAB’s experience and industry knowledge make them the ideal partner to help grow the iconic Krispy Kreme brand throughout the world. We remain focused on our long-term strategy and continuing to offer our premium, high-quality doughnuts and sweet treats to consumers around the world. We look forward to working with JAB to continue bringing the joy that is Krispy Kreme to a growing number of customers. Together with our talented team and our passionate franchisees, we will continue to build on the Krispy Kreme culture, values and commitment to our customers and guests.”
Peter Harf, Senior Partner at JAB, commented, “We are thrilled to have such an iconic brand as Krispy Kreme joining the JAB portfolio. This is yet another example of our commitment to investing in extraordinary brands with significant growth prospects. We feel strongly that Krispy Kreme will benefit greatly from our long-term focus and support for management’s vision in building on the legacy of this exciting brand as an independent standalone entity.”
Transaction Terms; Postponement of Annual Meeting
The transaction is not subject to a financing condition and is expected to close in the third quarter, subject to customary closing conditions, including receipt of regulatory and shareholder approvals.
In light of the announcement and pending transactions under the merger agreement, the Company’s Board of Directors has determined to postpone the Company’s 2016 Annual Meeting of Shareholders, originally scheduled for June 14, 2016. At a later date, the Company will provide information related to a rescheduled meeting, if applicable.