Attached files
Exhibit 99.2
GREEN MOUNTAIN COFFEE ROASTERS, INC. ANNOUNCES DEFINITIVE MERGER AGREEMENT
TO ACQUIRE DIEDRICH COFFEE, INC. FOR $35 PER SHARE IN CASH
Diedrich Terminates Merger Agreement with Peets
Waterbury, VT December 8, 2009 Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) (GMCR) today announced that it has entered into a definitive merger agreement to acquire Diedrich Coffee, Inc. (NASDAQ: DDRX) (Diedrich) for $35 per share in cash pursuant to a cash tender offer, in a transaction with a total value of approximately $290 million.
Concurrent with entering into the merger agreement with GMCR, Diedrich terminated its previously announced merger agreement with Peets Coffee & Tea, Inc. (NASDAQ: PEET) (Peets) (the Prior Agreement) following the expiration of the negotiation period granted to Peets under the terms of the Prior Agreement. In accordance with the terms of the Prior Agreement, on behalf of Diedrich, GMCR paid a termination fee of $8,517,000 to Peets in connection with such termination.
Lawrence J. Blanford, President and Chief Executive Officer of GMCR, said, We are delighted to have entered into a definitive merger agreement with Diedrich and look forward to realizing the substantial benefits of this transaction. This combination further advances our objective of becoming a leader in the highly fragmented and competitive coffee and coffee maker businesses and provides significant growth opportunities for GMCR stakeholders. In particular, adding Diedrichs three strong brand platforms, which are highly complementary to GMCRs brands, as well as its manufacturing and distribution facilities in California will, upon completion of this transaction, enable us to more effectively reach consumers across North America and do so with an enhanced array of coffee choices.
Paul C. Heeschen, Chairman of the Board of Diedrich, said, We are pleased to have reached this agreement with GMCR. This transaction maximizes value for our shareholders and is expected to bring new opportunities for both our employees and brands to grow as part of a stronger business platform. We want to express our appreciation to our employees. Their hard work and dedication has been instrumental in building this great company. We look forward to working with GMCR to ensure a smooth transition and complete the transaction as expeditiously as possible.
Under the terms of the merger agreement, GMCR will acquire all of the outstanding shares of Diedrich common stock for $35 per share in cash pursuant to a cash tender offer, with no financing and no due diligence contingencies. GMCR intends to fully finance this transaction through cash on hand and GMCRs existing bank lines of credit. The full terms and conditions of the GMCR offer will be contained in the Schedule TO which is expected to be filed with the U.S. Securities and Exchange Commission later this week. GMCR anticipates that this transaction will be neutral to slightly accretive within the first twelve months following the close, excluding one-time transaction expenses, and accretive thereafter.
The transaction is subject to customary closing conditions, including, among others, regulatory approvals. GMCR noted that it has thoroughly evaluated this transaction and is confident it can consummate the transaction promptly in early 2010. In that regard, the merger agreement includes a graduated reverse break-up fee structure such that the reverse break-up fee starts at $8,517,000 for a termination prior to February 15, 2010 and increases by $1,000,000 in each subsequent 60 day period through June 15, 2010, in each case payable by GMCR to Diedrich in the unlikely event that regulatory approvals are not obtained under the terms and conditions of the merger agreement.
BofA Merrill Lynch is serving as financial advisor to GMCR on this transaction and Ropes & Gray LLP is serving as its legal advisor. Houlihan, Lokey, Howard & Zukin Capital, Inc. is serving as financial advisor to Diedrich Coffee and Gibson, Dunn & Crutcher LLP is serving as legal advisor.
About Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR)
As a leader in the specialty coffee industry, Green Mountain Coffee Roasters, Inc. is recognized for its award-winning coffees, innovative brewing technology, and socially responsible business practices. GMCRs operations are managed through two business units. The Specialty Coffee business unit produces coffee, tea and hot cocoa from its family of brands, including Tullys Coffee®, Green Mountain Coffee®, Newmans Own® Organics coffee and Timothys World Coffee®. The Keurig business unit is a pioneer and leading manufacturer of gourmet single-cup brewing systems. K-Cup® portion packs for Keurig® Single-Cup Brewers are produced by a variety of licensed roasters, including Green Mountain Coffee, Tullys Coffee and Timothys. GMCR supports local and global communities by offsetting 100% of its direct greenhouse gas emissions, investing in Fair Trade Certified coffee, and donating at least five percent of its pre-tax profits to social and environmental projects. Visit www.gmcr.com for more information.
GMCR routinely posts information that may be of importance to investors in the Investor Services section of its website, including news releases and its complete financial statements, as filed with the SEC. The Company encourages investors to consult this section of its website regularly for important information and news. Additionally, by subscribing to the Companys automatic email news release delivery, individuals can receive news directly from GMCR as it is released.
About Diedrich Coffee, Inc. (NASDAQ: DDRX)
Diedrich Coffee specializes in sourcing, roasting and selling the worlds highest quality coffees. The company markets its three leading brands of specialty coffees, Diedrich Coffee, Coffee People and Gloria Jeans Coffees, through office coffee service distributors, restaurants and specialty retailers, and via the companys web stores. Diedrich Coffee is one of the few roasters under license to produce K-Cups for Keurig Incorporateds top-selling single-cup brewing system. For more information about Diedrich Coffee, call 800-354-5282, or go to www.diedrich.com, www.coffeepeople.com or www.coffeeteastore.com.
Forward-looking statements
Certain statements contained herein, including GMCRs intention to complete the proposed acquisition, are not based on historical fact and are forward-looking statements within the meaning of the applicable securities laws and regulations. Generally, these statements can be identified by the use of words such as anticipate, believe,, could, estimate, expect, feel, forecast, intend, may, plan, potential, project, should, would, and similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Owing to the uncertainties inherent in forward-looking statements, actual events or results could differ materially from those stated herein. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact on sales and profitability of consumer sentiment in this difficult economic environment, GMCRs success in efficiently expanding operations and capacity to meet growth, GMCRs success in efficiently and effectively integrating Tullys and Timothys wholesale operations and capacity into its Specialty Coffee business unit, GMCRs success in introducing new product offerings, the ability of lenders to honor their commitments under GMCRs credit facility, competition and other business conditions in the coffee industry and food industry in general, fluctuations in availability and cost of high-quality green coffee, any other increases in costs including fuel, Keurigs ability to continue to grow and build profits with its roaster partners in the At Home and Away from Home businesses, the impact of the loss of major customers for GMCR or reduction in the volume of purchases by major customers, delays in the timing of adding new locations with existing customers, GMCRs level of success in continuing to attract new customers, sales mix variances, weather and special or unusual events, as well as other risks described more fully in GMCRs filings with the U.S. Securities and Exchange Commission (the SEC). Forward-looking statements reflect managements expectations as of the date of this press release, and are subject to certain risks and uncertainties. GMCR does not undertake to revise these statements to reflect subsequent developments, other than in its regular, quarterly earnings releases.
Additional Information
The tender offer to purchase shares of Diedrich common stock referenced in this press release has not yet commenced, and this press release is neither an offer to purchase, nor a solicitation of an offer to sell, any securities. The tender offer to purchase shares of Diedrich common stock will be made only pursuant to a Tender Offer Statement on Schedule TO containing an offer to purchase, forms of letters of transmittal and other documents relating to the tender offer (the Tender Offer Statement), which GMCR will file with the SEC and mail to Diedrich stockholders. Security holders of Diedrich are advised to read the Tender Offer Statement when it becomes available, because it will contain important information about the tender offer. Investors and security holders of Diedrich also are advised that they may obtain free copies of the Tender Offer Statement and other documents filed by GMCR with the SEC (when these documents become available) on the SECs website at http://www.sec.gov. In addition, free copies of the Tender Offer Statement and related materials may be obtained (when these documents become available) from GMCR by written request to: Green Mountain Coffee Roasters, Inc., Attention: General Counsel, 33 Coffee Lane, Waterbury, Vermont 05676.
GMCR Contacts:
Investor Relations:
Frances G. Rathke, CFO
802-882-2300
Media:
Joele Frank / Dan Katcher
Joele Frank, Wilkinson Brimmer Katcher
212-355-4449