Recently formed multi-brand platform Panera Brands plans to go public, and it will do so with the help of restaurant veteran Danny Meyer.
The company, which includes Panera, Einstein Bagel Bros., and Caribou Coffee, announced intent to file documents with the SEC relating to a proposed IPO. Meyer's special purpose acquisition company (SPAC), USHG Acquisition Corp., and Panera Brands signed an agreement in which the SPAC will invest in the multi-brand platform and serve as a "cornerstone partner." Meyer will also invest directly in Panera Brands and become lead independent director following completion of the IPO.
Panera Brands' IPO will undergo the customary process and require approval from USHG Acquisition shareholders. As part of the agreement, shareholders of the SPAC will also become direct shareholders in Panera Brands, alongside current and future stockholders of the multi-brand platform. JAB Holding, the parent company of Panera Brands, will make a dollar-for-dollar investment in shares of Panera stock equal to the amount of any redemptions of USHG Acquisition shares.
The number of shares to be offered and the price range for the proposed offering have not yet been determined.
“Under CEO Niren Chaudhary’s leadership, Panera Brands embodies values consistent with [USHG Acquisition] and our Enlightened Hospitality roots, demonstrating that shareholder success is dependent on and driven by an employee-first stakeholder culture," Meyer said in a statement. "Importantly, Panera Brands meets our investment criteria to combine with a purpose-driven business that is scalable and built for the long-term; a market leader whose greatest strength is its talent and heart; a company where people love to work and with which customers, suppliers and partners love doing business. We are excited to partner with Panera Brands alongside JAB.”
Panera Brands, one of the fast-casual industry's largest platforms, was announced in early August. The three brands combine for nearly 4,000 locations and 110,000 employees across 10 countries.
The consolidation envisions Panera leveraging its sizable omnichannel retail network, digital infrastructure, loyalty program, food innovation pipeline, supply chain, and access to “extremely well-capitalized” franchise owners to fuel growth in Caribou and Einstein Bros., alongside Panera.
“We’ve long admired Danny’s work as he built some of today’s most beloved brands with a relentless focus on hospitality and culture," Panera Brands CEO Niren Chaudhary said in a statement. "The values of Panera Brands, which are based on a belief that we can be force multipliers for good, creating a positive impact on our communities and the planet, are values shared with Union Square Hospitality Group. We look forward to partnering to capitalize on the global growth opportunity for our brands.”
Each restaurant is owned by JAB, which purchased Panera for $7.5 billion in 2017, Caribou for $340 million in 2012, and Einstein Noah Restaurant Group for $374 million in 2014.
“We are excited to have Danny Meyer and [USHG Acquisition] as key partners with Panera Brands and for Danny to join Niren and the team as an active participant in its long-term success alongside Panera Brands shareholders," David Bell, senior partner at JAB, said in a statement. "This transaction unites two of the world’s leading hospitality organizations to work together on a successful transaction.”
Special purpose acquisition companies, like USHG Acquisition, are formed with the purpose of merging with an existing brand and turning it into a publicly traded company. USHG Acquisition was formed in February with intentions of entering a wide range of sectors, including technology, e-commerce, food and beverage, health and retail, and consumer goods.
The company lists its competitive strengths as fostering “Enlightened Hospitality,” building disruptive brands, and scaling rapidly.
“We went public with a focus on finding a category-leading business that embraces ‘Enlightened Hospitality’, including attracting and retaining the best talent by putting employees first, creating deep and emotional connections with customers and community, and being mindful of all stakeholders," Adam Sokoloff, CEO of USHG Acquisition, said in a statement. "We believe we found the ideal fit in Panera Brands.”