Firm with ties to Buffett reportedly considering topping JAB’s bid for Panera

Warren Buffett

David A. Grogan | CNBC
Warren Buffett

JAB Holdings’ buyout deal of Panera Bread may not be sealed just yet. There could be other options on the table for Panera to consider, the New York Post reports.

Brazilian private equity giant 3G Capital is weighing a rival bid for the fast-casual chain, the tabloid reported late Monday, citing unidentified sources close to the situation.

The private equity firm, whose holdings include Burger King and Tim Hortons and recently agreed to buy Popeyes Louisiana Kitchen, has hired New York-based investment bank Lazard to study the possibility of a bid, the Post said.

Earlier this month, JAB — the owner of Caribou Coffee and Peet’s Coffee & Tea — offered Panera Chief Executive Ron Shaich $315 in cash per share for the company, representing a more than 20 percent premium to the stock’s closing price on March 31, the last trading day before media began reporting on the potential deal.

If 3G decides to top JAB’s $7.5 billion offer, it would put two of the world’s largest private equity firms in direct competition for Panera’s more than 2,000 U.S. bakery cafes. Both firms have been making lots of deals as of late, and in February 3G’s $143 billion approach for Unileverwas rejected.

“Given that [3G and JAB] invest in each other’s deals, [competition for Panera] would be like going to war with your neighbor,” an investment banker with knowledge on the situation told the Post.

Panera Bread, 3G Capital and Lazard did not immediately respond to CNBC requests for comment.

St. Louis-based Panera has reportedly agreed to pay JAB a termination fee of $215 million, or 3 percent, if it accepts a greater offer.

The Post headline said: “Buffett-backed firm interested in bid for Panera Bread: sources,” although there was no indication in the Post’s report that Warren Buffett would be involved in the potential bidding for Panera.

The Brazilian PE firm has teamed up with the billionaire investor for deals in the past.

Buffett’s Berkshire Hathaway didn’t immediately respond to CNBC’s request for comment.

Shares of Panera were up nearly 1 percent Tuesday in premarket trade, having risen more than 45 percent over the past three months.

PNRA 3-month performance 

Source: FactSet

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