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Keurig to buy Dr Pepper Snapple to form a beverage giant

Keurig to buy Dr Pepper Snapple to form a beverage giant

K-cup maker Keurig Green Mountain will buy soda maker Dr. Pepper Snapple to form a beverage company with $11 billion in annual revenue.

Dr. Pepper Snapple shareholders will be paid a special cash dividend of $103.75 per share and will own 13 percent of the combined company, which will be called Keurig Dr. Pepper.

Germany’s JAB Holding Company, which owns a controlling stake in Keurig, will own the remaining 87 percent of Keurig Dr. Pepper.

JAB said it would make an equity investment of $9 billion to finance the transaction.

Shares of Dr. Pepper were up nearly 37 percent in premarket trade at $131.

Goldman Sachs served as lead financial adviser to Keurig and Credit Suisse served as financial adviser to Dr. Pepper Snapple for the deal.

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