# Keurig Snaps up Dr Pepper Snapple for $21B

By: [Team Stash](/content/learn/author/team-stash/index.html)  
Published: Jan 29, 2018  
•  Updated: Jun 09, 2026

The deal is a reverse merger. Wait, what’s that?

#### In this article:

1. [**What’s reverse merger?**](/content/learn/keurig-snaps-up-dr-pepper-snapple-for-21b/#whats-reverse-merger/index.html)

Move over Coca Cola and Pepsi. There’s some new competition in town.

On Monday, Keurig Green Mountain Inc., the maker of K-cup coffee pods, announced it would purchase soft drink maker Dr Pepper Snapple in a deal worth $21 billion, according to [Reuters](https://www.reuters.com/article/us-dr-pepper-snapp-m-a-keurig/k-cup-owner-keurig-grabs-dr-pepper-snapple-idUSKBN1FI1II).

Through the merger, Keurig instantly becomes a big challenger in the soft drink market dominated by Pepsi and Coca Cola, and will have annual revenue of approximately $11 billion, Keurig said.

The newly combined company will be called Keurig Dr Pepper. It will own popular brands including 7Up, Snapple, Sunkist, Motts, A&W Root Beer, and Green Mountain Coffee, among many others.

“The combination of Dr Pepper Snapple and Keurig will create a new scale beverage company which addresses today’s consumer needs, with a powerful platform of consumer brands and an unparalleled distribution capability to reach virtually every consumer, everywhere,” Bob Gamgort, chief executive officer of Keurig said in a statement.

The merger comes at a time when beverage makers of all kinds are hoping to branch out into drinks with [less sugar](/content/learn/ferrero-to-acquire-nestle-confectionary-division-for-2-8b/index.html), including coffees, teas, and sparkling juices, according to analysts. It also comes at a time when Keurig’s owner, an investment group called JAB, is hoping to move beyond fast food and coffee, according to [industry reports](https://www.bnn.ca/keurig-agrees-to-buy-dr-pepper-snapple-forming-beverages-giant-1.981386).

Although the new Keurig will be big competition in the soft drink industry, it is still dwarfed by Coca Cola and Pepsi, which have revenue of $41 billion and $63 billion respectively for the full year 2016, the most recent year for which data is available, according to [reports](https://www.cnbc.com/2018/01/29/dr-pepper-snapple-and-keurig-green-mountain-to-merge.html).

## What’s reverse merger?

JAB, a German-owned entity controlled by the billionaire [Reimann](https://www.ft.com/content/242db7ea-d1a8-11e5-831d-09f7778e7377) family, purchased Keurig in 2015 for [$14 billion](https://www.wsj.com/articles/keurig-green-mountain-agrees-to-get-bought-for-13-9-billion-1449493939). It also owns Krispy Kreme Donuts, Panera Bread, and Peet’s Coffee.

Keurig plans to combine Dr Pepper Snapple in what’s known as a reverse merger. Typically, when companies merge, both entities are either public or private. In this case, Keurig is private and Dr. Pepper Snapple is public. Keurig will essentially become a public company by purchasing the majority of the public company’s shares.

**Fun fact**: Dr Pepper Snapple shareholders will receive something called a premium to the value of the stock at the time of the deal. A premium is an amount worth more than the current value, meant as an incentive to shareholders who own Dr Pepper Snapple’s stock. Dr Pepper Snapple shareholders will get $103.75 per share, and own 13% of the combined company, Keurig said.

Mergers typically affect stock prices, and news of the deal sent Dr Pepper Snapple Stock up 24% to $118.87 by mid-day Monday, according to Yahoo Finance.*

The deal, which is subject to the approval of federal regulators, is expected to close by the second quarter, Keurig said.