Green Mountain Coffee (GMC), a leader in the specialty coffee industry, announced today [Thursday] that its wholly-owned subsidiary, Green Mountain Coffee Roasters, will have acquired a larger stake Keurig, Incorporated by the end of this month for approximately US$14.4m.
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Green Mountain Coffee Roasters completed financing through Fleet National Bank to exercise options on all of the 2,217,859 shares of Keurig granted to the company by Keurig shareholders at an exercise price of US$6.50 per share, including options previously exercised.
In addition to a one-year extension of GMC’s existing US$15m line of credit, the company has added an additional US$5m of term debt from Fleet National Bank in order to make this purchase and fund capital equipment purchases. The term debt provides for monthly interest payments and quarterly principal payments of US$625,000 over the two-year term of the loan.
Keurig has about 5.4 million issued shares of capital stock outstanding. After the purchase, GMC will own approximately 41% of Keurig, which includes 38,175 shares that GMC purchased directly from Keurig in 1996 and 1997.
GMC supported early research and development of the Keurig system, starting in 1994. In addition, it was the first of the current six companies to be licensed to package branded coffee in the patented Keurig K-Cup(TM).
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By GlobalDataRobert Stiller, president and CEO of GMC, said: “I am very pleased that we have received financing to increase our ownership in Keurig. The growth of the Keurig business holds great promise for GMC.
“Looking forward, I remain particularly excited about the potential that the Keurig technology holds for the home market.”
