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Keurig Dr Pepper Inc. (NASDAQ:KDP), a beverage giant with a market capitalization of $45.23 billion, disclosed on Friday that three of its board members, Joachim Creus, Frank Engelen, and Olivier Goudet, have resigned effective upon the closing of a significant public secondary offering. According to InvestingPro data, the company’s stock has shown resilience with a 5.4% gain year-to-date, despite recent corporate governance changes. The board members, who are affiliated with JAB BevCo B.V., a selling stockholder, have stepped down following the completion of the offering, which saw the sale of 73 million shares of common stock, resulting in gross proceeds of approximately $2.7 billion.
The resignations, which took place on Thursday, were not due to any disagreement with the company or its board, according to the statement. Subsequent to their departure, the board has reduced its size from eleven to eight directors. InvestingPro analysis indicates that KDP maintains a "FAIR" overall financial health score, with particularly strong marks in profitability and price momentum metrics.
In addition to the initial offering, J.P. Morgan Securities LLC, the underwriter for the offering, exercised a full option on Wednesday to purchase an additional 10.95 million shares. The closing of this offering, which included the option shares, occurred on Friday.
Keurig Dr Pepper emphasized that it did not receive any proceeds from the sale of the shares by the selling stockholder, JAB BevCo B.V., which is majority-owned by JAB Holding Company s.à.r.l. The transaction was part of a registered public secondary offering detailed in documents filed with the Securities and Exchange Commission, including a registration statement on Form S-3 and a prospectus supplement.
The company’s underwriting agreement with the selling stockholder and the underwriter, dated February 26, was also filed with the SEC and is referenced for a more detailed account of the terms.
This news follows Keurig Dr Pepper’s previous filings and is based on a press release statement. The company, known for its beverage and coffee systems, continues to navigate changes in its corporate governance and ownership structure. InvestingPro data reveals that KDP maintains impressive gross profit margins of 55.56% and has consistently raised its dividend for four consecutive years, currently offering a 2.74% yield. Subscribers to InvestingPro can access over 30 additional financial metrics and insights about KDP, including detailed valuation analysis and future growth projections.
In other recent news, Keurig Dr Pepper Inc. reported its Q4 2024 earnings, surpassing expectations with an earnings per share (EPS) of $0.58, compared to the forecast of $0.57. The company also exceeded revenue projections, posting $4.07 billion against an anticipated $4.02 billion. The robust performance was driven by strong growth in net sales and operating income, reflecting the company’s strategic initiatives. In light of these results, Jefferies analyst Kaumil Gajrawala raised the price target for Keurig Dr Pepper shares to $41, maintaining a Buy rating, citing the company’s strong finish to 2024 and exceeding expectations in organic growth and EPS.
Similarly, Citi analysts increased their price target to $41, up from $40, while also maintaining a Buy rating, following the company’s strong fourth-quarter performance, particularly in Refreshment Beverages. Meanwhile, Keurig Dr Pepper announced changes in its board composition after JAB Holding Company s.a.r.l. decided to sell a significant portion of its shares. This move will lead to the resignation of JAB-affiliated directors from the board. The company continues to focus on strategic investments, with the recent addition of the GHOST brand expected to drive sales growth towards the higher end of the forecasted range in 2025.
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