Warren Buffett-Backed 3G Capital mulls rival bid for Panera Bread
12 Apr 2017
Warren Buffett-backed Brazilian private equity firm 3G Capital, is mulling to table a rival bid for US bakery chain Panera Bread Co, which last week agreed to be acquired by JAB Holding Co, the New Post yesterday reported, citing sources close to the situation.
3G Capital, owner of Burger King, Kraft Foods and Tim Hortons, has hired investment bank Lazard to study the possibility of a bid, the report said.
JAB Holding, the investment vehicle of Germany's billionaire Reimann family, had last week struck a deal to buy Panera Bread for $7.2 billion, including debt of $340 million. (See: JAB Holding in pact to buy US bakery chain Panera Bread for $7.2 bn)
Panera has agreed to pay JAB a termination fee of $215 million if it accepts a better offer.
Panera Bread is a bakery-café fast casual restaurant chain operating in the US and Canada employing more than 100,000 people and generates annual revenues of $5 billion.
Founded in 1987, Missouri-based Panera Bread operates more than 2,000 bakery-cafes across the US and Canada selling soups, salads, pasta, sandwiches, bakery items, coffee, teas, smoothies and frozen drinks.
JAB Holding focuses on investments in companies with premium brands in the consumer goods sector.
The Luxembourg-based group owns controlling stakes in Jacobs Douwe Egberts, Keurig Green Mountain, global beauty products major Coty Inc, luxury goods makers Jimmy Choo, Bally, Belstaff, hygiene and home products giant Reckitt Benckiser, Krispy Kreme Doughnuts Inc, Stumptown Coffee Roasters, among others.
A successful deal would see JAB selling Caribou and Pete's coffee at Panera.
3G Capital is best known for teaming up with Warren Buffett's investment firm Berkshire Hathaway for acquiring Burger King, Tim Hortons, and Kraft Foods.
3G Capital, co-founded by Brazilian billionaire Jorge Paulo Lemann, is also well known for two reasons – for buying well known brands in the US food industry, and for maximising profit through a process called ''zero-cost budgeting,'' where every division of a company must justify its costs every financial year.