Krispy Kreme Inc. has announced that it is currently exploring its strategic options for Insomnia Cookies, which could potentially include an all-cash sale.
In 2018, Krispy Kreme acquired a controlling stake in Insomnia Cookies, a provider of warm cookies and ice cream for delivery. The company expects Insomnia Cookies to generate sales of approximately $230 million in fiscal 2023.
Insomnia Cookies was originally founded in Philadelphia as a late-night bakery by Seth Berkowitz, who was a student at the time. Since 2003, the company has been delivering its warm cookies day and night.
With this decision, Krispy Kreme aims to unlock shareholder value and focus on its core strategy of producing, selling, and distributing fresh doughnuts daily.
Currently, Krispy Kreme sells doughnuts from nearly 13,000 points of access each day. The company’s goal is to expand to over 75,000 points of access by entering three to five new countries per year and developing channels such as quick-service restaurants, according to Chief Executive Mike Tattersfield.
To assist with this exploration, Krispy Kreme has hired Evercore and Morgan Stanley as financial advisers.
As of now, Krispy Kreme’s stock was up 3% premarket and has gained 20% year-to-date, while the S&P 500 index has gained 11.7%.
