Keurig Dr Pepper (KDP), a prominent player in the beverage sector with brands like Dr Pepper, 7UP, Snapple, and Canada Dry (inside.beer, 29.1.2018), announced significant developments involving its major shareholder, JAB Holding Company.
JAB, an European investment firm controlled by the German Reimann family, which held a 20.9% stake in KDP, will reduce its holdings by selling 60 million shares through a secondary public offering at USD 32.85 per share, raising approximately USD 2 billion. Morgan Stanley is underwriting the offering, which also includes an option for an additional 9 million shares within 30 days. Following the sale, JAB’s stake will decrease to about 16.5%, or 15.8% if the option is exercised, with the remaining shares under a 90-day lock-up period.
At the same time, KDP announced changes to its board. Lubomira Rochet, who joined JAB Holding Co. in 2021 as a partner to promote growth and digital leadership across JAB’s portfolio companies, has resigned from the board of KDP with immediate effect, according to a filing with the Securities and Exchange Commission. The company specified that her departure was not related to any disagreement with the board or the company. It remains unclear whether this change is connected to JAB's planned reduction of its stake in KDP.
Frank Engelen, who currently serves as the Managing Partner and Chief Financial Officer of JAB Holding Company, has been appointed as Rochet’s immediate replacement, with his term set to run until the 2025 annual meeting. Engelen will not serve on any board committees.
KDP reported a 3.1% increase in net sales for the third quarter of 2024, with volume/mix growth of 3.5%, supported by strong international sales in Mexico and Canada. The company recently expanded its portfolio by acquiring a 60% stake in Ghost Energy (inside.beer, 29.10.2024), projected to boost growth by 300 basis points, showcasing its commitment to innovation in high-demand categories.
To support its strategic initiatives, KDP secured a USD 1.25 billion term loan, ensuring financial flexibility for corporate needs, including acquisitions. The company also raised its dividend by 7%, maintaining a 2.66% yield, appealing to income-focused investors. This follows consistent share buybacks, signaling management’s confidence in KDP’s future.
