CHARLOTTE, N.C., USA – Krispy Kreme, Inc. has announced it is exploring strategic alternatives for Insomnia Cookies, to include considering an all-cash sale. Krispy Kreme acquired a majority stake in Insomnia Cookies in 2018 and expects revenues of approximately $230 million in fiscal year 2023.
Today’s decision enables Krispy Kreme to unlock shareholder value and focus on its core strategy of producing, selling and distributing fresh doughnuts daily.
“We acquired a majority stake in Insomnia Cookies to build our e-commerce and digital capability as well as assist Insomnia’s U.S. and International expansion. Both efforts have been successful and it’s time for the next strategic step for both companies,” said Mike Tattersfield, Krispy Kreme CEO.
“Krispy Kreme has expanded rapidly through our capital light omni-channel model, and the brand is now in 37 countries selling fresh doughnuts through nearly 13,000 points of access daily,” continued Tattersfield. “Looking ahead, our goal is to expand to more than 75,000 points both by entering 3-5 new countries each year and developing new channels like quick service restaurants.”
Insomnia Cookies, the cookie brand known for serving warm cookies all day and late into the night, has rapidly grown since the 2018 acquisition, operating in three countries with over 250 bakeries. It is a pioneer and industry leader in digital marketing and e-commerce revenue, with 45% of revenue generated digitally while driving industry leading capital return over the past few years.
“It has been an honor to partner with Krispy Kreme in an unprecedented chapter of growth for Insomnia Cookies,” said Founder and Insomnia CEO Seth Berkowitz.
“As we enter our 20th year of delivering warm, delicious cookies, we are now a sizeable multi-channel enterprise but still have a huge runway ahead in the attractive $700 billion indulgence industry*, and I look forward to leading our Insomniacs in our next phase of significant domestic and global expansion.”
Krispy Kreme has hired Evercore and Morgan Stanley & Co. LLC to act as financial advisors.
*Source: Euromonitor, June 2023