On 19 May, JDE Peet's announced its intention to launch an initial public offering (IPO) and to list on the Amsterdam Stock Exchange.
A successful IPO of JDE Peet's would be credit positive for ultimate controlling shareholder JAB Holding Company – the company says – because it would increase the share of listed assets in JAB's investment portfolio. JAB could also use the IPO proceeds to reduce contingent instruments at Acorn Holdings, an intermediate holding company of JAB Holding.
JDE Peet's expects the primary component of the offering to be around €700 million (about US$765 million), and it will use the proceeds to repay debt at JDE Peet's.
The company has indicated that it intends to obtain an investment-grade rating from a major rating agency within one to two years of the publication date of the prospectus. JAB also stated that it intends to remain a majority shareholder of JDE Peet's, but that it will aim to create a meaningful free float in JDE Peet's at admission to trading.
A successful listing of JDE Peet's will significantly increase the share of listed investments in JAB's portfolio, and enhance the liquidity of the portfolio. At year-end 2019, JAB had approximately 53 per cent of its investments publicly listed.
With the listing of JDE Peet's, financial services company Moody's expects the value of JAB's publicly listed assets to be less concentrated on Keurig Dr Pepper.
Moody’s says the JDE Peet's IPO also should allow JAB to reduce, at least partially and subject to a successful offering, some of the contingent instruments at Acorn Holdings, a privately-owned intermediate holding company majority owned by JAB. Acorn holds approximately 73 per cent of the shares of JDE Peet's. The contingent instruments at Acorn Holdings have contributed to JAB's complex structure, and a simplification would improve JAB's overall risk profile and transparency.
