Federal regulators looking into the $290 million acquisition of Irvine’s Diedrich Coffee Inc. have asked for more details about the deal.
The company and Vermont-based Green Mountain Coffee Roasters Inc., which is buying Diedrich, said Wednesday they’re complying with additional information requests from the Federal Trade Commission.
The companies didn’t say what additional information regulators have inquired about.
Because of the request, the waiting period for the deal to conclude under antitrust laws has been extended.
In December, Green Mountain prevailed in a bidding war for Diedrich with Peet’s Coffee & Tea Inc. of Emeryville.
Diedrich supplies coffee to stores, restaurants and offices. Its shares saw a 9,500% rise last year, much of it before the bidding war.
The company has seen growth from a new type of single brewing cups known as K-Cups.
K-Cups allow you to brew a single cup of coffee in a special machine by putting one of the K-Cups into the slot where coffee grounds and a filter would go on other machines.
Green Mountain’s Keurig Inc. unit owns the K-Cup brand and grants licenses for others to produce them.
Regulators could have concerns about the deal’s impact on the market for K-Cups.
Green Mountain is seeking to consolidate production and sales of K-Cups, according to Mitchell Pinheiro, an analyst with Philadelphia-based Janney Montgomery Scott LLC.
Producing and selling K-Cups is about twice as profitable as collecting royalties from licensees, Pinheiro said.
“Green Mountain seems committed to rolling up its K-Cup licensees,” said David Tarantino, an analyst with Milwaukee-based Robert W. Baird & Co.
Other K-Cup producers include Minnesota’s Caribou Coffee Co. Inc. and Timothy’s Coffees of the World Inc. of Toronto.
