Krispy Kreme looks to raise as much as $640 million through IPO

Krispy Kreme is looking to raise between $560 million to $640 million through an initial public offering this year, according to regulatory filings from Tuesday.

The doughnut chain first went public 21 years ago during the dotcom bubble. In 2016, JAB Holding, the investment arm of the Reimann family, took Krispy Kreme private after buying it for $1.35 billion. JAB owns a number of other restaurant businesses, including Panera Bread and Caribou Coffee.

This time around, amid another hot market for IPOs, Krispy Kreme is looking to sell its stock for $21 to $24 a share, giving it an implied valuation of $2.82 billion to $3.22 billion.

In fiscal 2020, Krispy Kreme’s revenue rose 17% to $1.12 billion, but the chain reported a net loss of $60.9 million. It has reported net losses for its last three fiscal years as it invests back into the business, like spending $10.3 million to reopen a 24-hour flagship location in New York City’s Times Square.

The stock would trade on the Nasdaq under the proposed ticker “DNUT.”

About 16.6% of Krispy Kreme’s total common shares would be available through the IPO. The rest of the shares would remain in JAB’s hands. The investment firm is also looking to buy between $50 million to $100 million of shares from the offering. The firm’s chairman, Olivier Goudet, is interested in buying $5 million of shares.

The company said in the filing that it intends to use the net proceeds to repay debts, repurchase shares of stock from some of its executives and make payments on tax withholdings related to some restricted stock units. The rest of the funds will be used for general corporate purposes.

JAB reportedly completed an $800 million refinancing deal for Panera Bread recently, clearing the way for the sandwich chain to return to the public markets. JAB’s acquisition took it private in 2017.