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Financing

Krispy Kreme sets terms for a $600M IPO

The company set terms for its upcoming offering and started talking to investors as it seeks a return to the public markets.
Photograph: Shutterstock

Krispy Kreme could raise as much as $640 million in its upcoming initial public offering, based on terms the doughnut chain set on Tuesday.

The Charlotte-based company said it plans to sell 26,666,667 shares of stock at between $21 and $24 per share. If it sells at the mid-range of that price—$22.50—the company would raise $600 million. If it sells at $24 per share it would raise $640 million.

Underwriters also have a 30-day window to buy up to 4 million additional shares in the company.

The fundraise would give the company a $4 billion valuation, more than twice the valuation it had when the investment firm JAB Holding Co. bought it in 2016. 

Krispy Kreme filed for its IPO in May, which would make it just the second restaurant company to go public since 2015 and the first since Kura Sushi USA went public in 2019. But it also comes as the public equity markets have opened wide for the restaurant industry—both the fast-casual salad chain Sweetgreen and the drive-thru coffee concept Dutch Bros are planning their own IPOs this year. Another chain, Torchy’s Tacos, is reportedly considering such a move.

Krispy Kreme plans to trade on the Nasdaq stock exchange under the ticker symbol DNUT. The company reported a $3 million loss in the quarter ended April 4, when it generated $321.8 million in revenue, up 23%.

The company also operates the 191-unit cookie delivery chain Insomnia Cookies, which it acquired in 2018.

Krispy Kreme has been buying up franchisees, opting to take more control of its brand as it looks to expand. Krispy Kreme operates 365 U.S. shops and more than 1,100 international locations. Its doughnuts and other products are available in 7,000 additional locations like grocers and convenience stores.

Krispy Kreme’s ultimate offering price could change as the company gauges interest from investors in the IPO. Strong interest could send the estimated offering price higher while weak interest could send it lower.

J.P. Morgan, Morgan Stanley, BofA Securities and Citigroup are acting as lead book-running managers for the proposed offering.

BNP Paribas, Deutsche Bank Securities, Evercore ISI, Goldman Sachs, HSBC, Truist Securities and Wells Fargo are joint book-running managers. Capital One Securities, C.L. King, Credit Agricole CIB, Mischler Financial Group, MUFG, Ramirez & Co., Santander Investment Securities and Siebert Williams Shank are co-managers.

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