G.M.C.R., Peet's bidding to acquire Diedrich Coffee
November 24, 2009
by Eric Schroeder
WATERBURY, VT. — The bidding battle to acquire specialty coffee maker Diedrich Coffee, Inc. heated up on Nov. 24, as Green Mountain Coffee Roasters, Inc. (G.M.C.R.) submitted a revised proposal to acquire Diedrich Coffee for $32 per share in cash pursuant to a cash tender offer, in a transaction with a total value of approximately $265 million. Green Mountain Coffee’s offer was $2 more per share than its prior offer and appears to have topped a competing offer from Peet’s Coffee & Tea, Inc., Emeryville, Calif.
Green Mountain Coffee’s latest offer represents an approximately 57% premium to the closing market price of Diedrich common stock on Nov. 2, the last trading day prior to the public announcement of a proposed merger agreement between Diedrich and Peet’s.
“We remain firmly committed to this strategic combination with Diedrich,” said Lawrence J. Blanford, president and chief executive officer of G.M.C.R. “We believe our revised offer constitutes a superior proposal to Peet’s Nov. 22, 2009, offer, as it provides Diedrich shareholders with a substantial all-cash premium as well as greater value and greater certainty and speed of closing. This transaction will build upon the success of G.M.C.R.’s family of brands across North America and further advance G.M.C.R.’s objective of becoming a leader in the highly fragmented and competitive coffee and coffee maker businesses. We look forward to working with the Diedrich board to complete a mutually beneficial business combination for all our stakeholders.”
Patrick O’Dea, president and c.e.o. of Peet’s Coffee & Tea, said his company remains convinced its offer is superior to G.M.C.R.’s, “given the greater certainty of an expeditious closing and the potential upside for Diedrich’s shareholders through the Peet’s stock component.”