USA – Keurig Dr Pepper (KDP), a leading producer and distributor of hot and cold beverages, has made a capital investment of US$300m in La Colombe, a leading independent coffee roaster, for 33% shares in the US coffee roaster.
With a capital investment of $300m, to close in the third quarter, KDP will become La Colombe’s second largest investor, behind its majority owner and chairperson Hamdi Ulukaya, the founder of US dairy business Chobani.
La Colombe indicated the capital will be used to pay off company debt, as well as accelerate growth. As part of the deal, KDP has signed a sales and distribution agreement for La Colombe ready-to-drink coffee in its direct store distribution network, which is expected to drive meaningful growth in the brand’s availability across these mainstream retail channels.
In addition, in long-term licensing, KDP will manufacture, sell, and distribute La Colombe branded K-Cup coffee pods, under a license agreement, in the U.S. and Canada.
The press release describes La Colombe as a high-growth, super-premium coffee company that serves consumers across multiple channels, including retail trade, branded cafes, food service, and direct-to-consumer.
The brand is the only vertically integrated ready-to-drink coffee company, owning the entire coffee journey from conscious bean sourcing and premium roasting to the creation of exceptional product experiences for loyal customers, it added.
Founded in 1994, La Colombe also has several on-premises sites in New York, Texas, Chicago, California, Maryland, and Philadelphia.
“We are excited to partner with Hamdi and the La Colombe team to drive value for both companies,” stated KDP Chairman and CEO Bob Gamgort.
“This partnership will enable KDP to expand its reach into high growth ready-to-drink and super premium coffee segments and will meaningfully increase La Colombe’s availability to consumers.”
The transition of La Colombe ready-to-drink coffee distribution to KDP will begin in late 2023, while the launch of La Colombe branded K-Cup pods will occur during 2024.
This past December, Keurig Dr Pepper paid $863 million to acquire a 30% stake in Nutrabolt, the owner of the C4 Energy, C4 Pre-Workout, and XTEND beverage brands. A long-term sales distribution agreement was also a part of the agreement.
In November 2022, the company acquired a minority position in the Athletic Brewing Co. for $50 million.
In 2020, Molson Coors signed a distribution deal with La Colombe for its Draft Latte and Brazilian Cold Brew range in the US off-premise channel.
The agreement came just over a year after the two companies trialed two 4.2% abv cold brew coffees in selected US markets.