Keurig Dr Pepper Slides In Premarket After Announcing $18 Billion JDE Peet's Acquisition

Core Viewpoint - Keurig Dr Pepper is set to acquire JDE Peet's for approximately $18.3 billion, with plans to separate its coffee and beverage businesses post-merger, amid rising coffee bean prices due to tariffs [1][4]. Group 1: Acquisition Details - The acquisition is an all-cash deal, with Keurig Dr Pepper offering JDE Peet's shareholders $37.22 per share, representing a 20% premium over JDE Peet's closing price on the previous Friday [1]. - After the merger, Keurig Dr Pepper's coffee brands, including K-Cup pods, will be spun off into a new publicly listed entity, while its soft drink brands will remain a separate publicly traded business [2]. Group 2: Market Reactions - Following the announcement, Keurig's shares fell by 3.91% to $33.76 in premarket trading, while JDE Peet's shares rose by 17.33% to $36.40 [3]. Group 3: Historical Context - The planned split of the coffee and beverage businesses reverses a previous merger from 2018, where Keurig Green Mountain acquired Dr Pepper Snapple Group for $18.7 billion, likely influenced by a slowdown in U.S. coffee sales and ongoing tariff impacts [4]. Group 4: Tariff Impacts - Both companies have indicated that President Trump's 50% tariffs on Brazilian imports may affect their pricing strategies. Keurig's CEO noted that tariff impacts will become significant, while JDE Peet's CEO mentioned potential price increases in the U.S. market, although Brazilian coffee constitutes less than 30% of their usage [5].