Carlos Bastarache: dr-pepper-keurig-merger-jpg.jpeg

Monday, 29 January 2018

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I always thought things that sounded too good to be true usually aren't told why discovered this!

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If Fox News personality Sean Hannity and his fans thought their Keurig boycott last November would have a lasting effect on the company’s prospects, they were mistaken. That’s because Keurig Green Mountain just announced a massive new merger with fellow beverage conglomerate Dr Pepper Snapple that, as Forbes reports, will “create a beverage behemoth with $11 billion in pro-forma annual revenue.”

According to a press release, the new company Keurig Dr Pepper (or “KDP” for short) will possess “a portfolio of iconic consumer brands and unrivaled distribution capability to reach virtually every point-of-sale in North America.” Said portfolio includes Dr Pepper, 7UP, Snapple, A&W, Mott’s, Sunkist, Green Mountain Coffee Roasters, the popular Keurig coffee system, and “more than 75 owned, licensed and partner brands” used by the latter. As for the Dr Pepper Snapple shareholders, whose newfound position is a direct result of the company board’s “unanimous” decision to approve the merger, they “will receive $103.75 per share in a special cash dividend and retain 13% of the combined company.”

In a statement, Keurig CEO Bob Gamgort (who, as Forbes notes, will become KDP’s chief executive) said the merger “will create a new scale beverage company which addresses today’s consumer needs.” The precise “needs” he was referring to here weren’t entirely clear. Even so, Dr Pepper President and CEO Larry Young (who will join KDP’s board) celebrated the news as an opportunity to “provide the highest-quality hot and cold beverages to satisfy every consumer throughout the day.” There’s also the fact that, per Forbes‘ conclusion, “shares of Dr Pepper Snapple surged” as high as 42 percent after the announcement.

(Via Forbes)