Dive Brief:
- Krispy Kreme has sold its remaining stake in Insomnia Cookies Holdings back to Insomnia Cookies and certain existing shareholders, the company said Tuesday in a press release.
- Krispy Kreme will bring in $75 million from the sale and will use the funds to pay down debt after transaction-related fees and expenses.
- The sale is part of Krispy Kreme’s strategy to focus on its “two biggest opportunities: profitable U.S. expansion and capital-light international franchise growth,” CEO Josh Charlesworth said in a statement.
Dive Insight:
Krispy Kreme’s move to officially drop Insomnia relates to its $127 million sale of the company’s majority ownership stake last July. The proceeds from the 2024 transaction went toward its core doughnut business, expanding availability and paying down debt. The doughnut chain bought Insomnia in 2018.
Removing Insomnia Cookies from its portfolio also will allow Krispy Kreme to boost the profitability of its McDonald’s partnership. After demand dropped below expectations following the initial launch of its doughnut selection at McDonald’s, Krispy Kreme last month said it paused the rollout — which had reached 2,400 McDonald’s restaurants — to create a more lucrative model.
The transaction also represents opportunities for growth at Insomnia Cookies. With an increased stake from Verlinvest and Mistral Equity Partners, Insomnia said it has entered a “pivotal moment in accelerating Insomnia’s trajectory,” according to a press release emailed to Restaurant Dive.
The cookie concept, which has nearly 350 units in the U.S., Canada and the United Kingdom, is on a path to reach 1,800 units globally within the next decade, equating to roughly 180 new units each year.
In addition to the transaction, the chain also named three executives to its C-suite. Brent Chu, former executive of PepsiCo, Ferrara Candy Company and La Colombe, became chief financial officer. Katie Seawell, who has experience with consumer packaged goods companies and chains like Starbucks, was appointed chief marketing officer. Stephanie Boughner, who has worked at Curio Wellness, Aramark and Talent Solutions TAPFIN, is the chain’s newly appointed chief people officer.
