- Krispy Kreme said it was looking to sell its majority stake in Insomnia Cookies so it could focus on its core donut business.
- Krispy Kreme invested in Insomnia Cookies in 2018 as part of #39;a deal that would have valued Insomnia at less than $500 million. .
- Krispy Kreme CEO Mike Tattersfield said it was time for both companies to make next strategic moves.
Krispy Kreme (DNUT) announced Tuesday that it is putting its majority stake in Insomnia Cookies up for sale so it can focus on its core business, producing and selling donuts.
The company said it was exploring strategic alternatives for the cookie chain, “to include consideration of an all-cash sale.”
Krispy Kreme purchased its stake in Insomnia Cookies in 2018. Terms of the deal were not disclosed, but sources told CNBC it valued Insomnia Cookies at less than $500 million. dollars. The company was founded in 2003 by University of Pennsylvania student Seth Berkowitz, who remains chairman and chief executive officer (CEO). It operates in three countries with more than 250 sites. Krispy Kreme said it expects the company to generate about $230 million in revenue in fiscal 2023.
Krispy Kreme CEO Mike Tattersfield said the company invested in Insomnia Cookies “to grow our e-commerce and digital capabilities as well as help Insomnia's expansion in the United States and abroad.” #39;international”. He added that these efforts have been successful and that “it is time to take the next strategic step for both companies.”
Tattersfield explained that Krispy Kreme's goal is to increase the number of “access points”; from 13,000 to 75,000 by entering three to five new countries each year and developing new channels, such as fast food.
Shares of Krispy Kreme rose 0.6% on Tuesday and are up for the year.
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