Dr Pepper Snapple and Keurig Green Mountain to merge

By Rachel Arthur

- Last updated on GMT

Dr Pepper Snapple's portfolio includes Dr Pepper and 7UP
Dr Pepper Snapple's portfolio includes Dr Pepper and 7UP

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Dr Pepper Snapple Group and Keurig Green Mountain are to merge and create Keurig Dr Pepper: a new beverage company with ‘a portfolio of iconic consumer brands and unrivalled distribution capability’ in North America.

Bringing together coffee and soda brands such as Dr Pepper, 7UP, Snapple and Green Mountain Coffee Roasters, along with Keurig’s single-serve coffee system, Keurig Dr Pepper (KDP) will have annual sales of around $11bn.

Dr Pepper Snapple and Keurig have not commented on the overall value of the transaction but Thomson Reuters puts the deal at more than $21bn.

Keurig was acquired by private equity firm JAB Holdings Co in 2016, which also counts Krispy Kreme Doughnuts, Caribou Coffee, Peet's Coffee & Tea and Jacobs Douwe Egberts as part of its portfolio.

JAB Holdings will be the controlling shareholder of the new Keurig Dr Pepper company.

Confectionery and snack giant Mondelez International will have a ‘significant stake’ in KDP - around 13% - thanks to its existing 24.2% stake in Keurig Green Mountain. 

Upon closing of the transaction, Keurig shareholders will hold 87% and Dr Pepper Snapple shareholders will hold 13% of the combined company.

‘Powerful platform of consumer brands’

How does Keurig Dr Pepper size up?

PepsiCo: $63bn annual net revenue

Coca-Cola: $42bn annual net revenue

Keurig Dr Pepper: estimated $11bn annual sales

Gamgort will become chief executive officer of the combined company and Ozan Dokmecioglu, current chief financial officer of Keurig, will become its chief financial officer. Dr Pepper Snapple President and CEO Larry Young will take a role on KDP’s Board of Directors.

Bob Gamgort, Chief Executive Officer of Keurig, said, “Our view of the industry through the lens of consumer needs, versus traditional manufacturer-defined segments, unlocks the opportunity to combine hot and cold beverages and create a platform to increase exposure to high-growth formats.

“The combination of Dr Pepper Snapple and Keurig will create a new scale beverage company which addresses today’s consumer needs, with a powerful platform of consumer brands and an unparalleled distribution capability to reach virtually every consumer, everywhere.”

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