Keurig Dr Pepper launches $18 billion takeover bid for JDE Peet's

Jan 15 (Reuters) - U.S. soft drinks giant Keurig Dr Pepper KDP.O on Thursday launched its $18 billion all-cash takeover bid for coffee and tea group JDE Peet's JDEP.AS, setting the stage for a global coffee company that could rival market leader Nestle NESN.S.

Keurig will offer 31.85 euros for each share in JDE Peet's, whose board and a majority of shareholders have committed to accepting the offer, the two companies and Dutch special purpose vehicle Kodiak BidCo said.

The deal is set to close in the second quarter.

Keurig had in August announced the buyout, one of Europe's largest in recent years and one that would consolidate the global coffee market as bean prices hit record highs.

It had also announced plans to split the merged entity's coffee and other beverage businesses, including Dr Pepper sodas, into two publicly traded companies.

COFFEE PRICES AT RECORD HIGHS ON DROUGHT, TARIFFS

Global coffee prices have hit record peaks due to droughts in top producers Brazil and Vietnam and volatility after U.S. President Donald Trump imposed import tariffs on most trade partners.

In October, Keurig raised $7 billion from private equity firms to finance the purchase, allaying investor fears about mounting debt.

Shares of Netherlands-based JDE Peet's were little changed in early trading on Thursday and have been steady after a 17% jump on August 25, when the acquisition was announced.

They were at 31.92 euros at around 0900 GMT on Thursday, implying a market capitalisation of about 15.6 billion euros ($18.15 billion), according to LSEG data.

The companies said they had obtained competition clearances, and that the board of JDE Peet's fully supported the takeover and unanimously recommended shareholders accept it.

Investors holding a combined stake of 69% had irrevocably committed to the offer, they said.

($1 = 0.8595 euros)