Keurig Dr Pepper to Sell Chobani Stake, Facility for $925M
Keurig Dr Pepper has agreed to sell its entire equity stake in Chobani back to the food and beverage company for $800 million as it moves to strengthen its balance sheet before separating into two businesses.
In a related transaction, KDP will sell Chobani its manufacturing facility and warehouse in Allentown, Pennsylvania, for approximately $125 million. The facility agreement includes the lease, equipment and operations, bringing KDP’s combined pretax proceeds from the transactions to about $925 million.
KDP plans to use the net proceeds to reduce debt as it prepares to divide its operations into Beverage Co. and Global Coffee Co. The divestitures provide additional capital for deleveraging while transferring a major production site to Chobani.
Chobani plans to transform the 1.5 million-square-foot Allentown campus into a major manufacturing and innovation hub. The company expects to invest approximately $1.2 billion in the property over five years and support more than 900 jobs.
Chobani intends to offer employment opportunities to KDP’s manufacturing and warehouse workers at the site, helping preserve operational continuity during the ownership transition. KDP will retain employees working in delivery, customer service and other corporate functions.
The companies also entered into a transitional co-manufacturing agreement under which Chobani will continue producing certain KDP products at the facility for a specified period.
