Acorn Holdings
Acorn was a holding company for two businesses: Keurig Dr Pepper and JDE Peet’s. Keurig Dr Pepper is a leading beverage company in North America offering hot and cold beverages through household brand names such as Dr Pepper soft drinks and the Keurig coffee brewing system. JDE Peet’s is the world’s leading pure-play coffee and tea company.
- Pillar
- Private investments
- Theme
- Quality franchises
- Status
- Exited
- Geography
- Global, USA
- Invested date
- 2016 & 2018
- Security
- Preferred and common equity, warrants
RIT was introduced to Acorn through our close partnership with BDT, a leading US global investment firm investing in closely held, ‘crown jewel’ assets.
The bulk of RIT’s investment was in the form of preferred equity. This de-risked RIT’s investment by providing early returns in the form of a cash coupon (which has priority over common equity in terms of claims to a company’s cash flow), along with typical creditor protections were the value of the business to decline. The remainder of RIT’s investment comprised common shares and warrants, both instruments which benefit directly in line with a company’s increase in value.
Keurig and Dr Pepper merged in 2018, creating Keurig Dr Pepper which was listed on the New York Stock Exchange. This was followed by JDE Peet’s listing in 2020. RIT realised a ~2x return on invested capital and a 20% net internal rate of return (i.e. after fees and carried interest have been accounted for) through the sale of shares in Keurig Dr Pepper and JDE Peet’s, alongside the redemption of RIT’s preferred equity shares in Acorn Holdings.
Source: Company information
