Peet's Coffee might get a $2.2B IPO: it has more than just shops up its (coffee) sleeve
If you're not writing a novel... then you don't belong in a Peet's Coffee. Peet's was founded in Berkley, CA in 1966 by a man who "ignited a revolution that forever changed the expectations of American coffee drinkers." Today, it's owned by the privately held (and weirdly mysterious) German conglomerate JAB Holding — JAB also owns Panera, Krispy Kreme, Stumptown, and Keurig Dr Pepper. Now...
- JAB is looking to take Peet's public (again), aiming to raise $2.2B in an IPO (according to #PFWTM) — it would be one of the biggest IPOs this year so far.
- While many of Peet's 200+ shops are closed, 80% of Peet’s coffee is actually sold for home consumption (those fragrant bean blends hitting you at grocery stores).
- Ground coffee sales at US groceries jumped 11% in April, proving that demand for "Arabian Mocha-Java" bags is even stronger in the corona-conomy (people are trading $5 store-bought lattes for bags of beans).
But first, coffee... Caffeine-obsessed JAB is creating its own special blend of coffee (companies). Back in December, it mixed Peet's with Dutch brand JDE — its portfolio includes "iconic household names" like L’OR, Tassimo, and Pickwick. That combo is what is IPO'ing, and is expected to generate $7.5B in annual revenues.
JAB thinks coffee is pandemic-proof... As the most widely used psychoactive substance in the world, coffee is one of the most popular (and most addictive) consumer staples. In a recession, humans don't drink less coffee — they just drink cheaper coffee. That's why JAB will probably lean in even more into its pandemic-proof, at-home coffee biz.