Blog: Dean BestMondelez investors to benefit from Starbucks' compo pay-out

Dean Best | 13 November 2013

Starbucks has been ordered to pay Kraft Foods US$2.7bn in compensation for ending a deal that saw the manufacturer distribute the coffee chain's retail products - a move that is set to benefit the shareholders of Mondelez International.

In 2010, Starbucks ended a 12-year agreement that had seen Kraft ship the company's packaged coffee to US grocery outlets.

Starbucks claimed its "brand equity" had been "eroded"; Kraft insisted it had grown sales from less than US$50m in 1998 to around $500m.

Kraft filed for arbitration and yesterday it was announced Starbucks would have to pay over $2.7bn.

The arbitration was filed before Kraft's 2011 split that formed US-focused Kraft Foods Group and global snacks giant Mondelez International. As part of the contracts behind the split, the $2.7bn will go to Mondelez, which owns coffee brands including Carte Noire.

Mondelez said it intended to use the net proceeds to buy back some of its shares - boosting a share repurchase scheme worth $6bn.

Perhaps, then, the Starbucks cash could help Mondelez in any attempts temper some of the criticism of its performance and strategy from activist investor Nelson Peltz.

BLOG

Unilever and Danone continue B Corp push

Unilever and Danone are two of the largest food companies to have embraced the B Corp certification and over the last 24 hours have made fresh announcements....

BLOG

General Mills trials new way of buying Haagen-Dazs

On Friday (7 September), ice-cream lovers in part of central London were able to order Häagen-Dazs on their phones - and have it delivered directly to them, wherever they were....

BLOG

just-food closed on Monday 27 August

As I type, grey skies cover south-east London, with drizzle hitting the windows - but the forecast is set fairer for tomorrow when the country has its final public holiday before Christmas Day....



Forgot your password?