NEW YORK (TheStreet) -- Green Mountain Coffee Roasters (GMCR) said it will buy gourmet coffee roaster Van Houtte from an affiliate of Greenwich, Conn.-based private investment firm Littlejohn & Co for a cash purchase price of $890 million.
Green Mountain Coffee said Van Houtte has been a Keurig single-cup brewing system licensee since 2001. "We're confident that the company and its well-known Canadian brands including Van Houtte, Brûlerie St. Denis, Les Cafés Orient Express Coffee and Brûlerie Mont Royal are great additions to Green Mountain Coffee Roasters and our family of specialty coffee brands," company CEO Lawrence Blanford said in a prepared statement.
GMCR anticipates that the acquisition will be neutral to slightly dilutive to its earnings per share in the first twelve months after closing and accretive thereafter. The transaction is expected to close by the end of calendar year 2010.
Van Houtte's net sales for the last twelve months were about $433 million as of August 21.
GMCR plans to finance the acquisition through a combination of cash on hand and $1.35 billion of new debt financing comprised of $750 million five-year senior secured revolving credit facility, a $250 million five-year senior secured term loan A facility and a $350 million six-year senior secured term loan B facility.
Well-known Green Mountain brands in North America include its namesake Green Mountain Coffee brand, Tully's, Timothy's and Diedrich's.
Shares of Green Mountain stock have fallen 1.4% to $34.76 in Tuesday morning trading.
-- Written by Andrea Tse in New York.
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