Keurig Dr Pepper Announces Major Financing Update for JDE Peet’s Acquisition and Strategic Separation Plans

BURLINGTON, MA and FRISCO, TX (February 23, 2026) – Keurig Dr Pepper Inc. (NASDAQ: KDP) has released a detailed update on its financing plans and transaction timeline for the highly anticipated acquisition of JDE Peet’s. This move is part of a broader strategy to subsequently separate the company into two independent entities: “Beverage Co.” and “Global Coffee Co.”

Key Highlights from the Announcement

• Targeted Acquisition Close: The acquisition of JDE Peet’s is expected to close in early April 2026.
• Upsized Equity Investment: The previously announced \$3 billion convertible preferred equity investment for Beverage Co., co-led by Apollo and KKR, has been increased to \$4.5 billion. Additional participation comes from long-term, high-quality investors including accounts advised by T. Rowe Price Investment Management.
• No Partial IPO: The company will no longer pursue a partial IPO of Beverage Co., thanks to the enhanced equity financing.
• Global Coffee Co. JV: Definitive agreements have been finalized for the Global Coffee Co. Pod Manufacturing Joint Venture (JV), first announced in October 2025. The \$4 billion JV investment is co-led by Apollo and KKR, with participation from Goldman Sachs Alternatives.
• Debt Financing: Global Coffee Co. will issue long-term debt to finance the remaining portion of the JDE Peet’s acquisition. The total acquisition financing consists of approximately \$9 billion in long-term debt, \$8.5 billion in equity capital, and the assumption of approximately \$5 billion of existing JDE Peet’s bonds.
• Projected Leverage: The expected combined net leverage post-acquisition is approximately 4.5x (a non-GAAP metric), with plans for rapid deleveraging via strong cash generation and potential non-core asset monetization.
• EPS Impact: The transaction is projected to be approximately 10% EPS accretive in its first full year.
• Separation Timeline: The timing of the tax-free spin-off of Global Coffee Co. will depend on achieving key milestones, including leverage targets and market conditions. Operational readiness to separate is targeted by year-end 2026.

Details for Investors and Shareholders

Equity and Debt Financing Structure

The enlarged \$4.5 billion equity investment, with a preferred dividend rate of 4.75% and an initial conversion price of \$37.25 per share, is a significant change. This upsize means the company will not pursue a partial IPO of Beverage Co., potentially reducing IPO-related risks and dilution. The investment will remain with Beverage Co. after separation.

Global Coffee Co. will raise roughly \$9 billion in debt capital, combining long-term senior debt and temporary borrowing under its term loan facility. It will also assume \$5 billion in JDE Peet’s bonds. After separation, Global Coffee Co. plans to issue junior subordinated notes to repay any remaining term loans.

Strategic JV and Partnerships

The \$4 billion Pod Manufacturing JV strengthens Global Coffee Co.’s operational capabilities, and the commitments from Apollo, KKR, and Goldman Sachs Alternatives signal confidence from major financial players.

Balance Sheet and Deleveraging

KDP is introducing \$1.5 billion of cost-efficient equity, enhancing its capital structure and attracting high-quality, long-term investors. Management expects rapid deleveraging post-transaction, aiming for strong investment-grade balance sheets for both Beverage Co. and Global Coffee Co.

Potential Price-Sensitive Factors

• Abandoning Beverage Co. IPO: The decision to forego the partial IPO could impact valuation and investor sentiment, as it removes IPO-related uncertainty.
• EPS Accretion: The forecasted 10% EPS increase in the first full year is a positive indicator for shareholders.
• Leverage and Credit Ratings: The sizable debt load and assumption of JDE Peet’s bonds may affect credit ratings and future borrowing costs. The company acknowledges risks of potential credit rating downgrades.
• Separation Uncertainty: The timing of the spin-off is contingent on market conditions and leverage milestones, introducing execution risk.
• Regulatory and Integration Risks: The completion of the acquisition and separation is subject to regulatory approvals, which may be delayed or conditioned. Integration risks with JDE Peet’s and other ventures (such as GHOST Lifestyle LLC) are cited as potential challenges.
• Asset Monetization: The company is considering selling non-core assets to accelerate deleveraging, which could affect future earnings and asset values.

Company Overview and Forward-Looking Statements

Keurig Dr Pepper operates over 125 brands with annual revenues exceeding \$15 billion, and holds leadership positions in carbonated soft drinks, coffee, tea, water, juice, and mixers. The company’s innovative partnership model and strong distribution capabilities underpin its growth strategy and operational resilience.

Management emphasizes that forward-looking statements in this release are subject to numerous risks and uncertainties, including macroeconomic factors, integration complexities, regulatory hurdles, debt-related risks, and potential negative effects on share price related to the acquisition and separation announcements. Investors are cautioned that actual results may differ materially from projections.

Non-GAAP Financial Measures

KDP uses non-GAAP metrics such as Management Net Leverage and Adjusted EBITDA to evaluate performance. These measures differ from GAAP and are used for operational and financial decision-making. Adjusted EBITDA adjusts for items affecting comparability, such as mark-to-market impacts, amortization, stock compensation, transaction costs, and others.

The company does not provide GAAP reconciliations for forward-looking non-GAAP measures due to the unpredictability of certain items, including non-cash gains/losses and mark-to-market adjustments.

Restrictions and Disclaimer

This release does not constitute an offer or solicitation to buy or subscribe for any securities in JDE Peet’s N.V. Any offer will be made only via an approved offer memorandum. Distribution of this press release may be restricted in certain jurisdictions.

View Keurig Dr Pepper Inc. Historical chart here