Diedrich Coffee Announces Enhanced Offer From Green Mountain Coffee Roasters
December 02 2009 - 1:29AM
PR Newswire (US)
Board Determines Offer Continues to be Superior Proposal IRVINE,
Calif., Dec. 2 /PRNewswire-FirstCall/ -- Diedrich Coffee, Inc.
(NASDAQ:DDRX) announced that earlier today Green Mountain Coffee
Roasters, Inc. (NASDAQ:GMCR) enhanced its offer to enter into a
merger transaction pursuant to which GMCR would acquire all of the
outstanding shares of common stock of Diedrich Coffee for $35.00
per share in cash. In addition, GMCR proposed a form of merger
agreement that is more favorable to Diedrich Coffee's stockholders
than the current merger agreement between Diedrich Coffee and
Peet's Coffee & Tea, Inc. (NASDAQ:PEET). In light of this
enhanced proposal from GMCR, Diedrich Coffee today also announced
that its Board of Directors determined that the proposal from GMCR,
as revised, continues to be a "Superior Proposal" (as defined in
the Peet's merger agreement) to the terms of the merger agreement
with Peet's and the exchange offer contemplated thereby, as amended
by the revised proposal received from Peet's on November 30, 2009.
GMCR included with its enhanced proposal a revised merger agreement
signed by GMCR that reflects the $35.00 per share cash
consideration and contains other terms that are more favorable to
Diedrich Coffee's stockholders as compared to the existing merger
agreement with Peet's, as revised by Peet's recent proposal. More
specifically, in addition to the superior consideration, the
revised GMCR merger agreement provides for a reduction in the
limitations and restrictions on Diedrich Coffee's ability to
operate its business during the period prior to the completion of
the transaction, as compared to the Peet's merger agreement, as
well as an increase in the time period during which Diedrich Coffee
may remedy deficiencies relating to the satisfaction of certain
conditions to the tender offer. In addition, the revised GMCR
merger agreement includes a graduated reverse termination fee such
that, if the agreement is terminated by GMCR or Diedrich Coffee
under certain circumstances, a termination fee in an amount between
$8,517,000 and $11,517,000 (depending on the date of termination)
would be payable to Diedrich Coffee. GMCR submitted its enhanced
proposal in response to Peet's revised proposal received by
Diedrich Coffee yesterday evening, which offered to pay to Diedrich
Coffee's stockholders, for each share of Diedrich common stock
tendered and accepted in its exchange offer, a combination of 0.321
of a share of Peet's common stock and an amount between $21.265 and
$22.870 such that the value of the total consideration paid per
Diedrich share would be equal to $32.50, provided that Peet's
common stock has a value between $30.00 and $35.00 per share. If
Peet's volume-weighted average stock price over a designated five
trading day period prior to the completion of the exchange offer
were less than $30.00, the value per share received by Diedrich's
stockholders would be less than $32.50, and if Peet's
volume-weighted average stock price over that same period were
higher than $35.00, the value per share received by Diedrich's
stockholders would be greater than $32.50. As required under the
terms of the existing merger agreement with Peet's, Diedrich Coffee
today also transmitted notice of GMCR's enhanced proposal to
Peet's. The Board of Directors of Diedrich Coffee considered the
latest proposals of GMCR and Peet's and determined that GMCR's
$35.00 all-cash offer continued to be a Superior Proposal (as
defined in the Peet's merger agreement) to Peet's recent proposal,
as outlined above. Peet's most recent proposal enhanced the
original offer consideration, which consisted of a combination of
$17.33 in cash and a fraction of a share of Peet's common stock,
having a value equal to $8.67 based on a formula as provided in the
Peet's merger agreement, provided that in no event would such
fraction have exceeded 0.315 of a share of Peet's common stock,
representing total consideration of $26.00 per share. Peet's most
recent proposal expired at 5:00 p.m. Pacific Time today and thus
the consideration payable by Peet's reverted to the original offer
of $26.00 per share in cash and Peet's stock. Peet's has until 5:00
p.m. Pacific Time on Monday, December 7, 2009, to negotiate with
Diedrich Coffee to amend the current merger agreement and the
exchange offer contemplated thereby in a manner that the Board of
Directors of Diedrich Coffee determines is at least as favorable to
Diedrich Coffee's stockholders as the enhanced proposal from GMCR.
If Peet's fails to submit to Diedrich Coffee a new proposal that
leads to such a determination, then, at or after such time,
Diedrich Coffee intends concurrently to terminate the Peet's merger
agreement, pay to Peet's the termination fee required thereby and
enter into the new merger agreement described above with GMCR.
Gibson, Dunn & Crutcher LLP is serving as the legal advisor to
Diedrich Coffee and Houlihan, Lokey, Howard & Zukin Capital,
Inc. is acting as financial advisor. About Diedrich Coffee Diedrich
Coffee specializes in sourcing, roasting and selling the world's
highest quality coffees. The company markets its three leading
brands of specialty coffees, Diedrich Coffee, Coffee People and
Gloria Jean's Coffees, through office coffee service distributors,
restaurants and specialty retailers, and via the company's web
stores. Diedrich Coffee is one of only four roasters under license
to produce K-Cups for Keurig Incorporated's top-selling single-cup
brewing system. For more information about Diedrich Coffee, call
800-354-5282, or go to http://www.diedrich.com/,
http://www.coffeepeople.com/ or http://www.coffeeteastore.com/.
Forward Looking Statements Statements in this news release that
relate to future plans, financial results or projections, events or
performance are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended, and fall
under the safe harbor. Actual results and financial position could
differ materially from those anticipated in the forward-looking
statements as a result of a number of factors, including, but not
limited to, the financial and operating performance of Diedrich
Coffee's wholesale operations, the company's ability to maintain
profitability over time, the successful execution of the company's
growth strategies, the impact of competition, the availability of
working capital, and other risks and uncertainties described in
detail under "Risk Factors and Trends Affecting Diedrich Coffee and
its Business" in the company's annual report on Form 10-K for the
fiscal year ended June 24, 2009 and other reports filed with the
Securities and Exchange Commission. Except where required by law,
the company does not undertake an obligation to revise or update
any forward-looking statements, whether as a result of new
information, future events or changed circumstances. Additional
Information and Where To Find It Stockholders of Diedrich Coffee
are urged to read the relevant tender offer documents because they
contain important information that stockholders should consider
before making any decision regarding tendering their shares. Peet's
Coffee & Tea and its acquisition subsidiary have filed tender
offer materials with the SEC, and Diedrich Coffee has filed a
Solicitation/Recommendation Statement with respect to the tender
offer. The tender offer materials (including a Registration
Statement, an Offer to Purchase, a related Letter of Transmittal
and certain other offer documents) and the
Solicitation/Recommendation Statement contain important
information, which should be read carefully before any decision is
made with respect to the tender offer. The Registration Statement,
Offer to Purchase, the related Letter of Transmittal and certain
other offer documents, as well as the Solicitation/Recommendation
Statement, are available to all stockholders of Diedrich Coffee at
no expense to them. The tender offer materials and the
Solicitation/Recommendation Statement are available free of charge
at the SEC's website at http://www.sec.gov/. In addition,
stockholders are able to obtain a free copy of these documents from
Diedrich Coffee by mailing requests for such materials to: Diedrich
Coffee, Inc., Office of Investor Relations, 28 Executive Park,
Suite 200, Irvine, CA 92614. In addition to the tender offer
materials described above, Diedrich Coffee and Peet's file annual,
quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any reports,
statements or other information filed by Diedrich Coffee or Peet's
at the SEC public reference room at 100 F Street, N.E., Washington,
D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference room. Diedrich Coffee's and
Peet's filings with the SEC are also available to the public from
commercial document-retrieval services and at the website
maintained by the SEC at http://www.sec.gov/. Diedrich Coffee
Investor Relations: Scott Liolios or Cody Slach Liolios Group, Inc.
Tel 949-574-3860 DATASOURCE: Diedrich Coffee, Inc. CONTACT: Scott
Liolios or Cody Slach of Liolios Group, Inc., +1-949-574-3860, ,
for Diedrich Coffee Investor Relations Web Site:
http://www.diedrich.com/
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