JPMorgan Chase – Dutch Bros Coffee Mulls IPO
Dutch Bros Coffee is reportedly weighing an IPO for later in 2021, according to Bloomberg.
The Oregon-based chain, which has more than 450 units, is seeking to be valued at around $3 billion, sources told the media outlet. The company has talked to advisors, but no final decision has been made on the matter.
Dutch Bros prides itself as being the largest privately owned coffee chain in the U.S. In October 2018, the chain announced that private equity firm TSG Consumer Partners had acquired a minority stake. Financial terms of the deal weren’t disclosed. At the time, Dutch Bros expected to leverage TSG’s expertise and resources to reach 800 stores in five years and attract talent, employ innovative technology, and use business intelligence and data to advance operations.
The chain is currently in expansion mode. For example, The San Antonio Business Journal reported that Dutch Bros wants to open 35 stores in Texas in the next few years. In 2020, the company opened 70 units. Dutch Bros is based mainly in the West, with the Eastern-most stores coming in Texas and Oklahoma.
The coffee concept was founded in 1992 by Dane and Travis Boersma. It’s known for its specialty coffee, smoothies, freezes, teas, a private-label Dutch Bros Blue Rebel energy drink, and nitrogen-infused cold brew coffee.
The Dutch Bros news comes one week after the New York Times reported JAB Holding completed an $800 million refinancing for Panera that could “pave the way” for the company to return to the public stock market. The global investment firm purchased Panera and took it private for $7.5 billion in 2017. The publication said Panera may not require a traditional IPO, opening the door for a special acquisition company.
Additionally, in March it was reported that Torchy’s Tacos is moving forward with an IPO. The brand is reportedly working with Morgan Stanley, Bank of America Corp, and JPMorgan Chase & Co. Bloomberg said the IPO could happen as soon as this year. However, there hasn’t been a final decision and plans could change. The taco chain could raise about $300 million and be valued at about $1 billion, according to Bloomberg’s sources. In November 2020, Torchy’s announced that it sold a $400 million stake to a new group of investors in order to spark growth, more specifically, entering 10 new states in the next four years.
The most recent food and drink concepts to go public, BurgerFi and Landry’s, merged with special acquisition companies to do so. BurgerFi and OPES Acquisition Corp. agreed to merge in June 2020, with an anticipated initial enterprise value of approximately $143 million. In February, Fertitta Entertainment, which includes Golden Nugget Casinos and Landry’s, agreed to join Fast Acquisition Corp. in a deal that will value the company at $6.6 billion.
Other restaurant-led SPACs that are seeking a brand to merge with include Do it Again Corp., Bite Acquisition Corp., Tastemaker Acquisition Corp., USHG Acquisition Corp., Fast Acquisition II, and Sizzle Acquisition Corp.
Kura Sushi USA, a revolving sushi-style restaurant, went the traditional IPO route in 2019. The concept raised $41 million in its initial public offering. Prior to Kura Sushi, Wingstop and Fogo de Chao went public in 2015. However, Fogo de Chao went private in 2018.