FTC Investigates Green Mountain Coffee Roasters
Green Mountain Coffee Roasters acquired Diedrich Coffee Inc. in March after several months investigation by the Federal Trade Commission (FTC). The federal regulators scrutinized the impact that the sale of Diedrich Coffee would have on the single serve coffee for Keurig coffee machines .
Green Mountain purchased Keurig Inc in 2006 and has been working to consolidate production and Keurig K-Cup sales ever since. Tully’s Coffee Corp. wholesale division was bought early in 2009, followed by Timothy’s Coffees of the World Inc. in November of 2009. Shortly thereafter, in December, the deal for Diedrich Coffee Inc was agreed upon. Green Mountain successfully shut out the attempts of Peets Coffee to purchase Diedrich.
The size of the Diedrich purchase triggered an automatic federal review under the Hart-Scott Antitrust Improvement Act of 1976.
The Diedrich Coffee buyout constituted the largest acquisition of a licensee by Green Mountain, whose earlier transactions had apparently not been large enough to trigger a Hart-Scott-Rodino filing. The review by the FTC was quite extensive, spurred on by political pressure by some of Green Mountain competitors.
Keurig coffee makers and K-Cups are successfully changing the manner in which people are brewing coffee. There have been single cup brewers before the Keurig but none of them have drastically changed the coffee market like the Keurig brewer has. Many in the coffee industry see the growth of the K-Cup market as a game changer for coffee roasters that have captured consumers with gourmet coffee beans for more than two decades.
Baby boomers’ parents drank percolated coffee
