Keurig to merge with Dr. Pepper Snapple

The new company will have a portfolio of brands that includes Canada Dry, Motts and Van Houtte.

Coffee company Keurig Green Mountain is set to acquire the Dr. Pepper Snapple family of brands and create a new global beverage giant.

The new company, known as Keurig Dr. Pepper, will have an estimated $11 billion USD in annual global sales, but still puts it behind PepsiCo (which brought in $63 billion in sales in 2016) and Coca-Cola ($41 billion). The company merger comes as other beverage category players look to provide options to consumers whose tastes are shifting away from sugary drinks.

Keurig CEO Bob Gamgort will lead the new company, while Dr. Pepper Snapple CEO Larry Young will become a director.

Keurig Green Mountain’s brands include Keurig, Green Mountain, Van Houtte, Donut Shop Coffee and Timothy’s. Dr. Pepper Snapple’s brands include Dr. Pepper, Snapple, Canada Dry, Motts, Schweppes, Vernors and Crush, among others.

The combined Keurig Dr. Pepper company will be majority-owned (87%) by Keurig parent JAB Holding, while CPG giant Mondelez – an investor in Keurig as a result of a 2015 deal that merged its Jacobs coffee business with JAB’s Douwe Egberts coffee – will own the remaining 13%.

JAB has been selling off its holdings in high-end fashion brands like Jimmy Choo and Belstaff to diversify its holdings in food and beverage. The parent company acquired Keurig in 2016, and also owns Krispy Kreme, Panera Bread, Mighty Leaf Tea and Caribou Coffee.

In Canada, Keurig Green Mountain operates as Keurig Canada, while Dr. Pepper Snapple operates the Canada Dry Motts company as its Canadian subsidiary. Last week, Canada Dry Motts named Carol-Anne Gower, previously VP of marketing and business development, as VP and general manager, leading all of the company’s commercial operations in Canada.