Initially announced on September 15, 2008, the transaction was completed after receiving the required shareholders’ vote and satisfaction of the required closing conditions, as set forth in the Asset Purchase Agreement previously filed with the Securities and Exchange Commission. The Company financed this purchase through its existing $225 million senior revolving credit facility.
“This acquisition hits at the intersection of our goals -- to bring an outstanding specialty coffee brand into our family of brands and to expand GMCR’s West Coast presence,” said Larry Blanford, President and Chief Executive Officer of GMCR. “The acquisition strengthens our leadership in specialty coffee and will support our plans to establish our proprietary Keurig Single-Cup Brewing system as the preferred way to enjoy coffee throughout North America.”
Tully’s retail locations will continue to operate under license and supply agreements with GMCR. The retail and international business will remain an independent company, operating under the name of TC Global, Inc., owned by its existing shareholders, and managed by its existing management team.
As previously disclosed, the Company anticipates that this transaction will be neutral to slightly accretive to its earnings per share for the first twelve months of its ownership, and accretive thereafter.
About Green Mountain Coffee Roasters, Inc. (GMCR)
As a leader in the specialty coffee industry, Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) is recognized for its award-winning coffees, innovative brewing technology, and socially responsible business practices. GMCR’s operations are managed through two business units. The Specialty Coffee business unit produces coffee, tea and hot cocoa from its family of brands, including Tully’s Coffee®, Green Mountain Coffee® and Newman’s Own® Organics 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 and Tully’s Coffee. 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.GreenMountainCoffee.com and www.Keurig.com for more information.
Certain statements contained herein are not based on historical fact and are “forward-looking statements” within the meaning of the applicable securities laws and regulations. Owing to the uncertainties inherent in forward-looking statements, actual results could differ materially. 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, the Company’s
success in efficiently expanding operations and capacity to meet growth, the Company’s success in efficiently and effectively integrating Tully’s wholesale operations and capacity into its Specialty Coffee business unit, the ability of our lenders to honor their commitments under our 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, the unknown impact of management changes, Keurig’s ability to continue to grow and build profits with its roaster partners in the office and at home markets, the impact of the loss of one or more major customers for Green Mountain Coffee or reduction in the volume of purchases by one or more major customers, delays in the timing of adding new locations with existing customers, Green Mountain Coffee’s 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 the Company’s filings with the SEC. Forward-looking statements reflect management’s analysis as of the date of this press release. The Company does not undertake to revise these statements to reflect subsequent developments, other than in its regular, quarterly earnings releases.