Keurig Dr Pepper is selling its full equity stake in Chobani back to the yogurt company for $800 million as Chobani acquires KDP’s manufacturing and warehouse operation in Allentown, PA, for $125 million.
KDP stated it plans to use the net proceeds from the transactions to reduce debt as the company positions its split into two separate entities, Beverage Co. and Global Coffee Co.
At the same time, KDP and Chobani are expanding their long-term commercial relationship by updating and broadening their distribution agreement. KDP will continue to distribute La Colombe-brand ready-to-drink lattes and other Chobani-owned beverage products through its direct-store delivery network. The companies will also continue their long-term licensing, manufacturing, and distribution agreement for La Colombe-branded K-Cup pods in the United States and Canada, KDP noted.
Chobani will offer employment opportunities to the Allentown site’s manufacturing and warehouse employees. Those in delivery, customer service and other corporate functions will remain with KDP. To facilitate the transition, KDP maintained that Chobani will continue to manufacture certain Keurig Dr Pepper products at the Allentown facility for a defined period after the sale under a co-manufacturing agreement.
“These transactions reflect the success of our partnership with Chobani and are designed to create value for both organizations,” said Tim Cofer, Keurig Dr Pepper CEO. “Together, they enhance our financial flexibility, strengthen the efficiency of our manufacturing network and support the expansion of our important distribution partnership with Chobani. This change also positions the Allentown facility for continued growth under an owner whose strategic priorities are well matched to the site, while ensuring continuity for our brands, customers and employees.”
