Greek yogurt pioneer Chobani has acquired La Colombe for $900 million just a few months after Keurig Dr Pepper’s (KDP) announced its $300 million sales and distribution deal with the ready-to-drink coffee company.
The transaction included the combination of a newly issued $550 million term loan, cash on hand, the exchange of KDP’s minority equity stake in La Colombe into Chobani equity. Chobani’s founder and CEO Hamdi Ulukaya had been La Colombe’s sole investor until the KDP deal, and Chobani is also buying Ulukaya out as part of the latest acquisition.
During an exclusive phone interview with me, Ulukaya said he’s set his sights on La Colombe for a long time also as an advisor, and acquiring the brand is “very personal and careful.”
“We’ve been looking at the coffee category from a value-add perspective, and I just wanted to make sure [La Colombe] has independently grown up to become what they are today.” Ulukaya told me. “Now they can benefit from opportunities Chobani has created.”
Ulukaya notes how Chobani already has a play in the coffee creamer and oat milk categories, and La Colombe’s omnichannel presence and its full supply chain ownership as a premium RTD brand will well complement the company’s portfolio.
“At a time where the industry has faced challenges to grow sales, Chobani has delivered double-digit, volume-led sales growth, and considerable margin expansion. We have never been stronger or better positioned to chart our next chapter of growth,” Ulukaya said in a public statement.
Chobani and La Colombe cohosted a booth earlier in March at the Expo West using their respective products for demos, and their partnership will deepen as a result of the acquisition, according to Ulukaya.
Specifically, La Colombe is expected to benefit from Chobani’s extensive retail execution, marketing and cold chain capabilities to grow its multi-serve offering, while continuing to expand the presence of its single-serve product line, and grow underdeveloped channels like convenience retail through KDP.
La Colombe’s RTD line has reportedly grown more than 3x in the past five years thanks in part to consumers’ growing preference towards cold coffee — a multibillion-dollar category poised to reach $5.48 billion by 2032 globally, analysts estimated, attracting multiple coffee behemoths to cash in on:
Chobani added it will also help enhance La Colombe’s procurement practices, deliver meaningful cost synergies, and elevate its overall operational performance under its ownership.
“La Colombe is a unique brand and well positioned to continue its strong growth trajectory, including upside as its ready-to-drink line expands availability through our Company-owned DSD network and with premium K-Cup pods now in the market,” KDP Chairman and CEO, Bob Gamgort, said in a statement. “Both as a strategic partner and a minority shareholder, we are excited by the path ahead.”