UK high street icon Pret a Manger has been sold to JAB Holding for £1.5bn, according to numerous reports. As part of the deal, the company’s 12,000 employees will receive £1,000 each on completion.
JAB — a German conglomerate headquartered in Brussels — has acquired Pret from Bridgepoint, a fellow private equity firm. Bridgepoint itself acquired the brand for £364m in 2008, and has delivered year-on-year sales growth throughout ten years of ownership, now operating 530 stores across the globe. JAB adds Pret to its portfolio after buying out Krispy Kreme in 2016, having bought US coffee giant Keurig Green Mountain the year before. JAB also owns Stumptown Coffee Roasters and Peet’s Coffee and Tea, with Pret its first UK high street acquisition, but not its first sandwich shop: the company owns Panera Bread in the USA.
Pret’s fresh, socially conscious brand personality and approach to food is seen as a cornerstone of the brand’s appeal by JAB, and as such it is not expected to change: Stumptown Coffee Roasters is very much part of the specialty coffee market in the US and has not had its brand diluted by acquisition. Given JAB’s coffee expertise, it’s not unreasonable that Pret’s coffee game could be stepped up in an attempt to corner marketshare dominated by the likes of Starbucks, Costa and Caffe Nero. At the same time, this acquisition further strengthens Pret’s foothold in the grab-and-go arena, an arena that coffee shops are increasingly looking to target.
JAB will be hoping to improve where other corporate food giants failed. McDonalds acquired a 33% stake in Pret in 2001, but international ambitions crippled the brand’s finances and left it close to bankruptcy. While Bridgepoint was majority shareholder, it did not own the entire company, and JAB will also be buying out minor shareholders in this deal.
Pret a Manger CEO Clive Schlee broke the news of the deal with a piece of very good news indeed for its employees, emphasising how the company would be “thanking the people that really matter”:
Today is a big day for @Pret. As we welcome JAB, we’ll be thanking the people who really matter by giving each of our 12,000 employees £1,000 when the deal completes— Clive Schlee (@Cliveschlee) May 29, 2018
Schlee went on to say:
This is a day of celebration at Pret. This agreement recognises the hard work of all our amazing teams around the world. Bridgepoint has been wonderful owners of the business for more than a decade. All of us at Pret believe JAB will be excellent long‐term strategic owners. JAB believes in Pret’s values and supports our growth plans. I am really looking forward to this next chapter of Pret’s story. I am also pleased to say that 2017 was another year of solid results for Pret, and we achieved our ninth consecutive year of like‐for like sales growth. The brand continues to thrive around the world thanks to our simple recipe of freshly prepared food, served by genuinely engaged teams.
Meanwhile, JAB focused on its excitement for what is to come:
We’re very excited to partner with Pret and its talented team to continue their extraordinary growth story. Management’s proven track record and commitment to customer service, investment in innovation and approach to freshly prepared food position Pret well as it capitalises on evolving consumer taste and lifestyle preferences.
The deal is likely to complete summer 2018.