Nestle to Buy Chameleon Cold-Brew, Adding to U.S. Coffee Arsenal
(Bloomberg) -- Nestle SA is still thirsty for craft coffee. The Swiss food and beverage giant agreed to purchase Chameleon Cold-Brew, bolstering its portfolio of premium java in the U.S.
Austin, Texas-based Chameleon leads the nation’s organic cold-brew coffee market, a segment that has grown significantly as more consumers choose to take their caffeine fix cold.
The deal marks Nestle’s second investment in premium U.S. coffee in three months -- it agreed to pay $425 million for a 68 percent stake in Oakland, California-based Blue Bottle Coffee in September. Nestle Chief Executive Officer Mark Schneider has said the company is focusing on expanding coffee sales in the U.S.
“We are committed to helping Chameleon grow into new markets and channels, while retaining its values and, of course, delicious, premium crafted coffee,” Paul Grimwood, head of Nestle’s U.S. operations, said in a statement to Bloomberg News. Terms weren’t disclosed.
The acquisitions are part of a trend by big food and beverage companies to buy up smaller players to capture their rapid growth in premium segments. Nestle faces pressure as its leading position in the market for global packaged coffee has been challenged by JAB Holding Co. JAB has spent more than $30 billion expanding its empire with brewers such as Keurig Green Mountain and Peet’s.
Chameleon’s Chief Executive Officer Chris Campbell said his company will retain independence that extends to payroll and benefits.
The deal went through because Nestle will “let us keep doing what we’re doing, but give us the opportunity to accelerate what we do,” he added in a phone interview.
The smaller roaster makes organic, cold-brew coffee in a variety of formats including ready-to-drink bottles, concentrate, kegs, cold-brew kits and whole bean coffee.
“Our intent here is to come out of this as the case study for how a big company can successfully acquire, integrate and both add and collect value from this kind of situation,” Campbell said. “It’ll take us awhile to see if it’s true or not, but we’re working on it.”
©2017 Bloomberg L.P.