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Peet’s Coffee owners defy pandemic to hit €19bn IPO valuation

Mohit Oberoi
Author: Mohit Oberoi

Last Updated: May 29, 2020

JDE Peet’s shares surged 15% on their first day of trading on Friday to become Europe’s biggest initial public offering (IPO) since 2018.

The firm is the world’s second-largest packaged coffee maker, with Peet’s Coffee and Douwe Egberts among its most popular brands. The company priced the shares at €31.5o and raised €2.25bn on the Amsterdam market, valuing the business at €16.8bn ($18.7bn) to become the continent’s first major flotation since the pandemic.

“We are thrilled to price this offer on Euronext Amsterdam during this extraordinary time,” said chief executive Casey Keller, who watched the opening via a remote video link.

JDE Peet’s, which competes against larger rival Nestle and to a lesser extent Starbucks, also owns the Pickwick, Senseo, Tassimo, TiOra and L’OR brands. It had revenue of €6.9bn in 2019, with the bulk of its products sold via supermarkets and to businesses. JDE Peet reported revenues of €6.9bn and a net profit of €585m last year.

The listing was a big test for JAB Holdings, the private investment group that manages the wealth of Germany’s billionaire Reimann family and controls JDE Peet’s.

JDE Peet’s IPO is coming at a time when many companies, including Airbnb, shelved plans to go to the public markets because on investor indifference and relied on private financing. However, life seems to be coming back to the primary market and a number of companies filing for an IPO in the US over the last two weeks.

Fidelity Management and Research, and George Soros’s Quantum Partners participated in JDE Peet’s IPO.

Following the offering, JAB will remain the company’s largest shareholder through a holding company called Acorn that control JDE Peet’s. JAB’s direct interest will give it a 38% stake. US food group Mondelez will be its second-largest shareholder with 23.4%.

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Mohit Oberoi

Mohit Oberoi is a freelance finance writer based in India. he has completed his MBA with finance as majors and also holds a CFA charter. He has over 13 years of experience in financial markets. He has been writing extensively on global markets for the last six years and has written over 6,500 articles. He mainly covers metals, electric vehicles, asset managers, and other macroeconomic news. He also loves writing on personal finance and topics related to valuation.