Krispy Kreme to Become a Privately Owned
Company Operating Independently
Krispy Kreme Doughnuts, Inc. (NYSE: KKD) (“Krispy Kreme” or the
“Company”) and JAB Beech Inc., an indirect controlled subsidiary of
JAB Holding Company (“JAB”) in which BDT Capital Partners is a
minority investor alongside JAB, 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 Krispy Kreme’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 Krispy
Kreme’s 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.
Advisors
Wells Fargo Securities, LLC is serving as financial advisor to
Krispy Kreme in connection with this transaction and Simpson
Thacher & Bartlett LLP and Womble Carlyle Sandridge & Rice,
LLP are providing legal support and advice.
Barclays and BDT & Company LLC are serving as financial
advisors to JAB Beech in connection with this transaction and
Skadden, Arps, Slate, Meagher & Flom LLP is providing legal
advice.
About Krispy Kreme
Krispy Kreme is a leading branded specialty retailer and
wholesaler of premium quality sweet treats and complementary
products, including its signature Original Glazed® doughnut.
Headquartered in Winston-Salem, NC, the Company has offered the
highest quality doughnuts and great tasting coffee since it was
founded in 1937. Today, there are over 1,100 Krispy Kreme shops in
more than 26 countries around the world. Connect with the Krispy
Kreme brand at www.krispykreme.com.
About JAB
JAB Holding Company is a privately held group focused on
long-term investments in companies with premium brands, attractive
growth and strong margin dynamics in the Consumer Goods category.
The group's portfolio includes controlling stakes in Keurig Green
Mountain, a leader in single-serve coffee and beverage
technologies, Jacobs Douwe Egberts (JDE), the largest pure-play
FMCG coffee company in the world, Coty Inc., a global leader in
beauty, and in luxury goods companies including Jimmy Choo, Bally
and Belstaff. JAB also has controlling stakes in Peet's Coffee
& Tea, a premier specialty coffee and tea company, Caribou
Coffee Company, a specialty retailer of high-quality premium coffee
products, Einstein Noah Restaurant Group, Inc., a leading company
in the quick-casual segment of the restaurant industry, and in
Espresso House, the largest branded coffee shop chain in
Scandinavia. JAB also owns a minority stake in Reckitt Benckiser
PLC, a global leader in health, hygiene and home products. In July
2015, Coty announced it had reached a definitive agreement to
purchase some of Procter & Gamble's beauty brands to create one
of the world's largest cosmetic companies. JAB is overseen by its
three Senior Partners, Peter Harf, Bart Becht (Chairman) and
Olivier Goudet (CEO). For more information, please visit the
company's website at: http://www.jabholco.com.
Forward Looking Statements and Investor Information
The foregoing contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995. We
intend for these forward-looking statements to be covered by the
safe harbor provisions of the federal securities laws relating to
forward-looking statements. Forward-looking statements are based on
management’s beliefs, assumptions and expectations concerning the
proposed transaction involving the Company and JAB Beech Inc. (the
“transaction”), including statements relating to regulatory
approvals and the expected timing, completion and effects of the
proposed merger and other future events and the transaction’s
potential effects on the Company, including, but not limited to,
statements relating to anticipated financial and operating results,
the companies’ plans, objectives, expectations and intentions, cost
savings, and other statements. Forward-looking statements involve
risks and uncertainties that may cause our actual results,
performance or financial condition to differ materially from the
expectations of future results, performance or financial condition
we express or imply in any forward-looking statements. Forward
looking statements often contain words such as “believe,” “may,”
“forecast,” “could,” “will,” “should,” “would,” “anticipate,”
“estimate,” “expect,” “intend,” “objective,” “seek,” “strive” or
similar words, or the negative of these words. Actual results may
differ materially from the results anticipated in these forward
looking statements due to various factors, including, without
limitation: the ability to obtain the approval of the transaction
by the Company’s shareholders; the ability to obtain governmental
approvals of the transaction or to satisfy other conditions to the
transaction on the proposed terms and timeframe; the possibility
that the transaction does not close when expected or at all, or
that the companies may be required to modify aspects of the
transaction to achieve regulatory approval; the outcome of pending
or future litigation; the quality of Company and franchise store
operations and changes in sales volume; risks associated with the
use and implementation of information technology; our ability, and
our dependence on the ability of our franchisees, to execute on our
and their business plans; our relationships with our franchisees;
actions by franchisees that could harm our business; our ability to
implement our domestic and international growth strategy; our
ability to implement and operate our domestic shop model;
political, economic, currency and other risks associated with our
international operations; the price and availability of raw
materials needed to produce doughnut mixes and other ingredients,
and the price of motor fuel; our relationships with wholesale
customers; reliance on third parties in many aspects of our
business; our ability to protect our trademarks and trade secrets;
changes in customer preferences and perceptions; risks associated
with competition; risks related to the food service industry,
including food safety and protection of personal information;
compliance with government regulations relating to food products
and franchising; and increased costs or other effects of new
government regulations; and other risks and uncertainties. These
and other risks and uncertainties, which are described in more
detail in the Company’s most recent Annual Report on Form 10-K and
other reports and statements filed with the United States
Securities and Exchange Commission (“SEC”), are difficult to predict, involve
uncertainties that may materially affect actual results and may be
beyond the Company’s control. New factors emerge from time to time,
and it is not possible for management to predict all such factors
or to assess the impact of each such factor on the Company. Any
forward-looking statement speaks only as of the date on which such
statement is made, and the Company does not undertake any
obligation to update any forward-looking statement to reflect
events or circumstances after the date on which such statement is
made. Investors, potential investors and others are urged to
carefully consider all such factors and are cautioned not to place
undue reliance on these forward-looking statements.
ADDITIONAL INFORMATION AND WHERE TO FIND IT
This communication does not constitute an offer to buy or sell
or the solicitation of an offer to buy or sell any securities or a
solicitation of any vote or approval. This communication relates to
a proposed acquisition of the Company by JAB Beech Inc. In
connection with this proposed acquisition, the Company may file one
or more proxy statements or other documents with the SEC. This
communication is not a substitute for any proxy statement or other
document the Company may file with the SEC in connection with the
proposed transaction. INVESTORS AND SHAREHOLDERS OF THE COMPANY ARE
URGED TO READ THE PROXY STATEMENT AND OTHER DOCUMENTS THAT MAY BE
FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY IF AND WHEN THEY
BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION.
Any definitive proxy statement(s) (if and when available) will be
mailed to shareholders of the Company. Investors and shareholders
will be able to obtain free copies of these documents (if and when
available) and other documents filed with the SEC by the Company
through the website maintained by the SEC at http://www.sec.gov.
Copies of the documents filed with the SEC by the Company will be
available free of charge on the Company’s internet website at
www.krispykreme.com or by contacting the Company’s corporate
secretary’s office at 370 Knollwood Street, Winston-Salem, N.C.
27103 or by calling (336) 726-8876.
Participants in Solicitation
The Company, its directors and certain of its executive officers
may be considered participants in the solicitation of proxies in
connection with the proposed transaction. Information regarding the
persons who may, under the rules of the SEC, be deemed participants
in such solicitation in connection with the proposed merger will be
set forth in the proxy statement if and when it is filed with the
SEC. Information about the directors and executive officers of the
Company is set forth in the Company’s most recent Annual Report on
Form 10-K and other reports and statements filed with the SEC,
including the Company’s proxy statement for its 2016 annual meeting
of shareholders, which was filed with the SEC on May 5, 2016, the
Company’s Quarterly Report on Form 10-Q and the Company’s Current
Reports on Form 8-K.
These documents can be obtained free of charge from the sources
indicated above. Additional information regarding the participants
in the proxy solicitation and a description of their direct and
indirect interests, by security holdings or otherwise, will be
contained in the proxy statement and other relevant materials to be
filed with the SEC when they become available.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160509005812/en/
For JABAbernathy MacGregorTom Johnson/Pat Tucker,
212-371-5999orKrispy Kreme MediaDarryl Carr,
336-726-8996orKrispy Kreme Investor RelationsAnita Booe,
336-703-6902
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