Peet’s Coffee & Tea has signed an agreement to acquire a majority stake in the Intelligentsia Coffee roaster and retailer, the company said Friday, just weeks after announcing a deal to acquire Stumptown Coffee Roasters.
Terms of the transaction were not disclosed. The deal will bring yet another coffee brand into the growing portfolio of JAB Holding Co., previously known as Joh. A. Benckiser Group, which bought Peet’s in 2012. JAB later acquired Caribou Coffee and Einstein Noah Restaurant Group Inc.
JAB Holding’s investments come as Millennials drive a shift toward super-premium coffees, Peet’s officials said.
“We’re excited to welcome Intelligentsia to the Peet’s family, as the growth of the super-premium coffee market continues to explode in the U.S.,” said Dave Burwick, president and CEO of Emeryville, Calif.-based Peet’s Coffee & Tea. “It’s driven by 18- to 34-year-olds who are more affluent, purchase premium brands from other categories, like craft beer and pressed juice, and seek variety and new experiences.”
Under the deal, Intelligentsia will continue to operate as a separate brand. The goal is to offer differentiated, craft-coffee brands with unique propositions to better capture that market, he said.
Peet’s, Intelligentsia and Stumptown are “highly complementary brands and businesses that collectively satisfy the desires of the new coffee connoisseur,” Burwick said.
Chicago-based Intelligentsia was founded in 1995, and is considered a pioneer in the “third wave” coffee movement, focused on small-batch roasting and direct-trade sourcing.
Intelligentsia operates 10 coffee bars in Chicago, Los Angeles and New York, as well as roasting operations in Chicago, Los Angeles and San Francisco. The company will also continue to grow its wholesale and grocery business.
Under the deal, Intelligentsia co-founders Doug Zell and Emily Mange, as well as co-owner Geoff Watts, will retain a stake in the business and will stay actively involved in operations, officials said.
In a statement, Zell said Peet’s “respects our vision and shares our same values.”
“Emily and I both spent many years in the Bay Area and watched first hand as Peet’s scaled their business while staying committed to their quality and craft. Peet’s is where I started my career in coffee, and I’m delighted to be working with them again,” he added.
Skadden, Arps, Slate, Meagher & Flom LLP served as legal counsel to Peet’s on the deal, while Piper Jaffray served as financial advisor. Kirkland & Ellis LLP acted as legal counsel for Intelligentsia.
Correction: Nov. 2, 2015 This story has been updated to clarify Joh. A. Benckiser Group's renaming as JAB Holding Co.
Contact Lisa Jennings at [email protected].
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