Panera to Become Part of JAB’s Coffee Empire

With the $7.5 billion deal for Panera, the investment firm has now spent more than $40 billion on acquiring coffee and breakfast concepts.
Matthew HellerApril 5, 2017
Panera to Become Part of JAB’s Coffee Empire

The investment arm of Germany’s Reimann family has agreed to acquire Panera Bread for $7.5 billion, a move that adds another concept to its growing coffee and breakfast empire.

Under the terms of the deal announced Wednesday, JAB Holding Co. will pay $315 per share — a premium of 30% to Panera’s 30-day trading average as of March 31, the last day before media reports circulated about a possible acquisition — and take Panera private.

JAB’s other recent acquisitions have included the $13.9 billion purchase of K-cup maker Keurig Green Mountain and the $1.35 billion deal for Krispy Kreme. The Reimann family are heirs to the consumer goods company Joh. A. Benckiser.

Drive Business Strategy and Growth

Drive Business Strategy and Growth

Learn how NetSuite Financial Management allows you to quickly and easily model what-if scenarios and generate reports.

Panera, which was founded as Au Bon Pain Co. in 1981 by Louis Kane and Ron Shaich, serves soups, salads, sandwiches and baked goods at about 2,000 locations. In the first quarter, its same-store bakery-cafe sales increased 5.3%.

“We strongly support Panera’s vision for the future, strategic initiatives, culture of innovation, and balanced company versus franchise store mix,” JAB Chief Executive Oliver Goudet said in a news release.

As The New York Times reports, JAB has now spent “more than $40 billion in what appears to be a big bet that it can muscle in on a market dominated by Starbucks and Nestlé.” It also owns the bagel chain Einstein Brothers, which it has been combining with Caribou in some markets.

While the restaurant business as a whole has been struggling, Panera has done better than others in the fast-casual sector by removing ingredients like artificial preservatives from its menu, making WiFi widely available and giving customers healthy options.

Shaich, who controls roughly 15% of Panera’s stock, said one of the biggest attractions of the JAB deal was the chance to take his company private.

“For the last 20 years, I’ve spent 20 percent of my time telling people what we’ve done to grow and another 20 percent of my time telling people what we’re going to do to grow,” he told the NYT. “I won’t have to do that anymore.”