Dr Pepper Will Unwind Merger With Keurig After $18 Billion Peet's Acquisition – CoffeeTalk

Dr. Pepper and Keurig are set to become separate companies after a $18 billion deal. The company will split into two, one selling coffee and the other selling cold beverages like Snapple, Dr Pepper, 7UP, and energy drinks. This move unwinds the 2018 merger between the two companies. Keurig Dr. Pepper CEO Timothy Cofer said that the separate coffee and beverage businesses would be more nimble and better able to focus on growth opportunities in their own markets.

The combination with Peet’s parent JDE Peet’s significantly expands Keurig’s presence beyond North America, where it is known for its single-serve coffee machines. The combined coffee business will generate $16 billion in annual net sales, helping the companies compete with other large coffee players like Nestle and Starbucks and take advantage of growing global coffee sales.

The merger could also help the company cushion the impact of U.S. tariffs, as President Donald Trump imposed a 50% tariff this summer on most imports from Brazil, the world’s leading coffee producer. The newly formed beverage company can continue to pivot to its faster-growing beverages, like the energy drinks Ghost and Bloom.

The companies expect to save around $400 million over three years because of the merger, which is expected to close in the first half of 2026. Once the two companies are separated, Cofer will become CEO of the cold beverage business, which will be based in Frisco, Texas. Keurig Dr Pepper’s chief financial officer, Sudhanshu Priyadarshi, will lead the coffee business, which will be located in Burlington, Mass. Its international headquarters will be in Amsterdam.

This deal is the latest big maneuver in the food and beverage industry, which has been trying to keep up with changing consumer tastes. In 2023, Kellogg Co. split into two companies, with Mars buying Kellanova last year and Ferrero planning to buy WK Kellogg, the cereal company.

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