What in the world are they thinking? I thought this had to be a joke. They are buying to get into a market, not buying to enhance their franchise. What an awful transaction. And look, they get a crappy business, DDRX, nil franchise value/creation. That was a perfectly orchestrated business and stock pump manipulation over there at Diedrich too.
I would not be surprised to see CBOU eat their lunch now. Tattersfield is developing the franchise - there are good things to come.
PEET has retail locations so why the difference? If Tattersfield succeeds in making them profitable CBOU will retain more diversified business model while continuing to expand K-Cup / Commercial business as well. I'm not ready for them to throw in the towel just yet - they generate A LOT of cash. Don't let depreciation expense fool you into believing the retail locations should be ditched. The investment has been made. Unfortunately a non-cash expense makes the bottom line look bad but this is changing due to reduced capital spending.