Financing

JDE Peet's will take over Caribou's coffee roasting operations

The global coffee maker is buying the coffee chain’s roasting operations and will start supplying coffee for the 800-unit chain.
Caribou
Caribou is rapidly growing with its drive-thru "Cabin" prototype. | Photo courtesy of Caribou Coffee.

Peet’s is taking over another Caribou operation.

JDE Peet’s, the Amsterdam-based coffee company that owns the Peet’s Coffee & Tea chain in the U.S., is now taking over the coffee roasting operation for Caribou Coffee, the company said on Thursday.

JDE Peet’s, created in 2019 with the combination of Jacobs Douwe Egberts and Peet’s, is acquiring Caribou’s coffee roasting operation in Minneapolis. It will then start supplying coffee products for the 800-unit Caribou.

Fabien Simon, CEO of JDE Peet’s, called Caribou “an iconic brand with outstanding facilities” and said that his company “will complement its strong brand equity with JDE Peet’s distribution and innovation capabilities to strengthen our presence and serve more coffee lovers in the largest coffee market in the world.”

The deal also highlights the diverging fortunes of Caribou’s and Peet’s respective coffee shop chains in recent years.

JAB Holding, the European investment firm, acquired both concepts in 2012. Shortly after buying Caribou, it shuttered 80 of that chain’s units and rebranded another 88 to the Peet’s name.

That deal appears to have been better for Caribou than for Peet’s. Caribou has mostly recovered the locations it lost during that period in the U.S.—it has about 500 here. And it has grown internationally and now operates about 300 units overseas.

The brand also has strong growth plans in the coming years, thanks to a focus on franchising and the development of a drive-thru-only concept.

Caribou signed several deals last year to franchise more than 300 locations in the U.S. For instance, it opened its first location in Florida in November under a multi-unit agreement with the operator Wake Up 727. Caribou is now part of Panera Brands, which is expected to go public some time in 2024.

As for Peet’s, its coffee shop hasn’t done quite as well. It operated 331 locations before taking over those 88 units. By 2022 it operated 260, according to data from Restaurant Business sister company Technomic.

But the deal with Caribou now gives JDE Peet’s inroads into supplying more U.S. coffee shops.

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