Keurig Dr Pepper Will Soon Own A Popular California Coffee Brand

Big players are making big moves in the world of fun beverages and morning energy juice (aka coffee). Keurig Dr Pepper is acquiring JDE Peet's for a hefty $18.3 billion, with the intention of soon creating two separate companies, one establishing itself as a leader in the coffee market and the other in the refreshment beverage space.

Just looking at the name of the company as it stands now, Keurig Dr Pepper, tells you that this company has a strong presence in two markets at once. On one side there are the Keurig coffee machines and single-serve pods, along with popular brands like Lavazza, Green Mountain, and McCafé. On the other side, the company owns soft drinks such as Dr Pepper, 7 Up, and Sunkist. Now, with the acquisition of JDE Peet's, the lineup of coffee brands will expand even further, as the company being acquired owns well over 20 brands — Jacobs, Peet's Coffee, Maxwell House, and more.

Once the sale is complete, Keurig Dr Pepper will split into Global Coffee Co. and Beverage Co., each with its own CEO and an independent, large market to conquer. After a recent decline in profits due to price increases, this new shift could be a strategy to bring in more revenue.

Tim Cofer, the CEO of Keurig Dr Pepper, stated in a press release, "Through the complementary combination of Keurig and JDE Peet's, we are seizing an exceptional opportunity to create a global coffee giant." Peet's Coffee, in particular, is known for its expertly roasted specialty coffee, something the newly established Global Coffee Co. is surely eager to add to its portfolio, as it chases the goal of becoming the top pure-play coffee company in the world. There's no set date yet for when Keurig Dr Pepper will embark on its split-company journey, but once it does, Global Coffee Co. is set to bring in $16 billion annually through its many brands.

This focus on creating a dominating coffee company doesn't take away from the beverage side of things, though. The newly-minted Beverage Co. is planned to become "a fast-growing and scaled North American refreshment beverage player," predominantly focusing on the U.S. and Canadian markets, instead of instantly trying to conquer the world (so to speak). The beverage company's annual revenues are predicted to exceed $11 billion, and with the North American beverage market being valued at $300 billion, the opportunities for growth seem endless.