Krispy Kreme has sold its majority stake in Insomnia Cookies to private equity firms Verlinvest and Mistral Equity Partners, the doughnut chain announced Monday. It will remain a minority shareholder, retaining around 34% of the cookie company.
Krispy Kreme received $127.4 million for the sale and expects an additional $45 million in the coming weeks as Insomnia Cookies’ debt is refinanced, for a total of $172.4 million.
The transaction closed on July 17.
The move isn’t exactly a surprise: Krispy Kreme said last October that it was considering “strategic alternatives” for Insomnia Cookies, including a sale.
Krispy Kreme bought Insomnia Cookies in 2018, and since then Insomnia’s revenue has tripled. The sale puts its enterprise value at $350 million, double what it was when Krispy Kreme bought it.
The doughnut chain, a subsidiary of JAB Holdings, said it would use the proceeds of the sale to pay down debt as well as expand.
Verlinvest has financial interest in a variety of food & beverage companies including oat milk brand Oatly, coconut water brand Vita Coco, liquor companies Rémy Cointreau and Leblon, açaí company Sambazon, and condiment producer Sir Kensington’s.
Mistral is an investor in restaurant brands El Pollo Loco, Jamba, and Vino Volo as well as a Tampa franchisee of Dunkin’ and Baskin-Robbins, plus food manufacturers and the supermarket chain Safeway.
Krispy Kreme president and CEO Josh Charlesworth said in a press release announcing the sale that it would benefit both his company and Insomnia.
“As we build a bigger and better Krispy Kreme, this transaction allows us to focus on our core strategy of producing, selling, and distributing fresh doughnuts daily while also further strengthening our balance sheet,” he said. “Following a thorough review, we are confident that Verlinvest and Mistral are the right partners to share in the success of Insomnia Cookies given their food industry experience and long-standing track record of value creation.”
Insomnia Cookies founder and CEO Seth Berkowitz said he was pleased with the sale, too.
“Building off of a very successful five-year partnership with Krispy Kreme, we’re thrilled to welcome Verlinvest and Mistral to this new chapter of our journey.”
Krispy Kreme said it would update its full year 2024 guidance at its upcoming second-quarter earnings call on Aug 8.
Contact Bret Thorn at [email protected]
