JAB BV has entered into an agreement to acquire Panera for approximately $7.5 billion.

LUXEMBOURG — JAB BV, an investment arm of the JAB Holding Company, has entered into an agreement to acquire the Panera Bread Co., St. Louis, for approximately $7.5 billion. Upon completion, the acquisition will add to JAB’s growing global roster of bakery cafe chains that also include Caribou Coffee, Einstein Noah, Espresso House, Krispy Kreme Doughnuts and Peet’s Coffee and Tea.

Under the agreement, JAB will acquire Panera for $315 per share in cash and the assumption of $340 million in debt. The agreement represents a premium of approximately 30 percent to Panera’s 30-day volume-weighted average stock price as of March 31. The transaction has been approved by Panera’s board of directors.

Olivier Goudet, JAB Holding Co.
Oliver Goudet, chief executive officer and a partner in JAB

“We have long admired Ron (Shaich) and the incredible success story he has created at Panera,” said Olivier Goudet, CEO and a partner in JAB. “I have great respect for the strong business that he, together with his management team, its franchisees and its associates, has built.  We strongly support Panera’s vision for the future, strategic initiatives, culture of innovation, and balanced company versus franchise store mix. We are excited to invest in and work together with the company’s management team and franchisees to continue to lead the industry.”

Rumors that Panera Bread may be for sale began circulating on April 3. Shares of the company’s stock climbed 11.7 percent that day to a high of $292.42 before closing at an all-time high of $282.63. Bloomberg News indicated such companies as JAB, Domino’s Pizza and Starbucks Corp. as potential suitors.

Ron Shaich, founder, chairman CEO of Panera

“By any measure, Panera has been one of the most successful restaurant companies in history,” said Shaich, who is the founder, chairman and CEO of Panera. “What started as one 400-square-foot cookie store in Boston has grown to a system with over 2,000 units, approximately $5 billion in sales, and over 100,000 associates. In more than 25 years as a publicly traded company, Panera has created significant shareholder value.

“Indeed, Panera has been the best performing restaurant stock of the past 20 years – up over 8,000 percent. Today’s transaction is a direct reflection of those efforts, and delivers substantial additional value for our shareholders.”

The transaction is not subject to financing conditions and is expected to close during the third quarter of 2017. It is subject to the approval of Panera shareholders and customary closing conditions.

Shaich has entered into a voting agreement whereby he and groups affiliated with him have agreed to vote shares representing approximately 15.5 percent of the company’s voting power in favor of the transaction. Following the close of the transaction, Panera will be privately held and continue to be operated independently by the company’s management team.

“Over the last five years, we have developed and executed a powerful strategic plan to be a better competitive alternative with emerging runways for growth,” Shaich said. “The themes we have bet on - digital, wellness, loyalty, omni-channel, new formats for growth - are shaping the restaurant industry today.”