Feb 24, 2026 (MarketLine via COMTEX) --
The US soft drinks company has taken the convertible preferred equity investment earmarked for the future company so far dubbed Beverage Co. from $3bn to $4.5bn.
Keurig Dr Pepper has secured additional financing for its ae15.7bn ($18.36bn) acquisition of Dutch coffee group JDE PeetaEUR(TM)s and subsequent split of the combined business into two.
The US soft drinks company has taken the convertible preferred equity investment earmarked for the future company so far dubbed Beverage Co. from $3bn to $4.5bn.
As a result, Keurig Dr Pepper said it no longer plans to pursue a partial IPO of Beverage Co., which will focus on the amalgamated company's non-coffee drinks.
Keurig Dr Pepper intends to separate into two entities, with the other provisionally called Global Coffee Co., aEURoeas soon as practicableaEUR after closing the deal. It aims to finalise the transaction by early April and plans to complete the split by year-end.
The upsized convertible preferred equity round is co-led by Apollo and KKR, with additional participation from backerts including accounts advised by T Rowe Price Investment Management.
Some aEURoeother high-quality, long-term oriented investorsaEUR are also taking part, Keurig Dr Pepper added.
The instrumentaEUR(TM)s terms are aEURoesubstantially consistentaEUR from the original terms announced in October, including an initial conversion price of $37.25 per share and a 4.75% preferred dividend rate, the 7Up maker added.
Post-separation, the preferred instrument will remain with Beverage Co.
Announcing theAdeal in August, the company said Beverage Co., based in Frisco, Texas, will operate as a aEURoescaled challengeraEUR in North AmericaaEUR(TM)s $300bn refreshment beverage market, with $11bn in annual sales.
With approximately $16bn in combined annual net sales, Global Coffee Co. is poised to become the aEURoeworldaEUR(TM)s largest pure-play coffee companyaEUR, it added the time.
Global Coffee Co.aEUR(TM)s global headquarters will be in Burlington, Massachusetts, with international headquarters in Amsterdam, the Netherlands.
Keurig Dr Pepper CFO Anthony DiSilvestro said yesterday (23 February) the updated plan adds $1.5bn of aEURoecost-efficient equity capitalaEUR and brings in aEURoea high-quality mix of shareholders". He added the funds should support aEURoerapid deleveragingaEUR and help position both Beverage Co. and Global Coffee Co. as aEURoesuccessful, investment-grade companiesaEUR.
Under the revised funding mix, Keurig Dr Pepper expects to finance the acquisition through roughly $9bn of long-term debt, $8.5bn of equity capital and the assumption of about $5bn of existing JDE PeetaEUR(TM)s bonds.
The company has projected a combined net leverage of approximately 4.5x at close and reiterated expectations the deal will be about 10% earnings-per-share accretive in the first full year.
Keurig Dr Pepper said it is also evaluating additional ways to accelerate deleveraging, including including aEURoepotential non-core asset monetisation opportunitiesaEUR.
On the coffee side of the transaction, Keurig Dr Pepper said definitive agreements have now been executed for the Global Coffee Co. pod manufacturing joint venture first announced in October.
That JV includes a $4bn investment co-led by Apollo and KKR, with participation from Goldman Sachs Alternatives, and remains subject to customary closing conditions.
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