CHARLOTTE, NC, and PHILADELPHIA, PA — Krispy Kreme, Inc. (NASDAQ: DNUT) today announced the sale of a majority ownership stake in Insomnia Cookies to Verlinvest and Mistral Equity Partners. The transaction values Insomnia Cookies at $350 million, doubling its worth since Krispy Kreme’s 2018 acquisition.
Insomnia Cookies, a late-night bakery chain headquartered in Philadelphia, was founded by University of Pennsylvania student Seth Berkowitz in 2003. The company has grown to over 250 locations worldwide, offering cookies, ice cream, and other treats for in-store purchase, local delivery, and nationwide shipping.
“As we build a bigger and better Krispy Kreme, this transaction allows us to focus on our core strategy of producing, selling, and distributing fresh doughnuts daily while also further strengthening our balance sheet,” said Josh Charlesworth, Krispy Kreme President and CEO.
The deal closed on July 17, 2024. Krispy Kreme received $127.4 million from the sale and expects another $45 million soon, following a refinancing of Insomnia Cookies’ intercompany debt. The proceeds will be used to bolster Krispy Kreme’s doughnut business and reduce debt. Krispy Kreme retains about a 34% minority stake in Insomnia Cookies.
“Following a thorough review, we are confident that Verlinvest and Mistral are the right partners to share in the success of Insomnia Cookies given their food industry experience and long-standing track record of value creation,” Charlesworth added.
“Building off of a very successful five-year partnership with Krispy Kreme, we’re thrilled to welcome Verlinvest and Mistral to this new chapter of our journey,” said Seth Berkowitz, who will continue as CEO of Insomnia Cookies.
Verlinvest Managing Director Clément Pointillart expressed enthusiasm for the investment. “We are eager to support Seth and help unlock the full potential of the business both in the US and internationally.”
Andrew Heyer, Founder and CEO of Mistral Equity Partners, added, “We are excited to partner with the company through the next phase of its growth. Having known Seth since 2004, we are delighted to have the opportunity to work with him again as well as the best-in-class teams at Krispy Kreme and Verlinvest.”
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