Green Mountain Shorts Slayed; Stock Spikes 45% As Coke Takes Stake; SodaStream Slammed

Tyler Durden's picture

With 31% of the float short, Green Mountain, despite announcing weaker than expected numbers, are spiking over 45% on news that Coca-Cola is taking a 10% stake. Albeit at a discount to the price at which GMCR closed today ($80.88 close vs $74.98 purchase price); the massive squeeze is Volkswagen-reminiscent. As the following press release explains, The Keurig Cold System is in development and thus SodaStream is getting creamed in the after-hours market (down over 10%). It seems, once again, that Whitney Tilson has managed to get himself in a short squeeze.


GMCR shorts slayed...


SodaStream crushed...


The Coca-Cola Company and Green Mountain Coffee Roasters, Inc. Enter into Long-Term Global Strategic Partnership

The Coca-Cola Company to Partner with Green Mountain Coffee Roasters, Inc. in  the Launch of Keurig’s New Cold Beverage Platform; Coca-Cola to Purchase 10% Minority Equity Stake in Green Mountain Coffee Roasters, Inc. for $1.25 Billion

The Coca-Cola Company (NYSE: KO) and Green Mountain Coffee Roasters, Inc. (GMCR) (NASDAQ: GMCR) announced today that the companies have signed a 10-year agreement to collaborate on the development and introduction of The Coca-Cola Company’s global brand portfolio for use in GMCR’s forthcoming Keurig Cold™ at-home beverage system. Under the global strategic agreement, GMCR and The Coca-Cola Company will cooperate to bring the Keurig Cold™ beverage system to consumers around the world. In an effort to align long-term interests, the companies also entered into a Common Stock Purchase Agreement whereby The Coca-Cola Company will purchase a 10% minority equity position in GMCR.

Under the terms of the equity agreement, The Coca-Cola Company will acquire 16,684,139 newly issued shares in GMCR for approximately $1.25 billion, which represents an approximate 10% ownership in GMCR (after giving effect to the issuance). The newly issued shares have been priced at $74.98, which represents the trailing 50-trading-day volume weighted average price (“VWAP”) as of market close today.

As part of the strategic collaboration, GMCR will be The Coca-Cola Company’s exclusive partner for the production and sale of The Coca-Cola Company-branded single-serve, pod-based cold beverages. The two companies also will explore other future opportunities to collaborate on the Keurig® platform.

With The Coca-Cola Company as a global strategic partner in our multi-brand at-home Keurig Cold beverage system, we believe there is significant opportunity to premiumize and accelerate growth in the cold beverage category by empowering consumers with an innovative, convenient way to freshly prepare their favorite cold beverages at the push of a button,” said Brian P. Kelley, President and CEO of GMCR. “This global relationship combines The Coca-Cola Company’s unparalleled brand, distribution and marketing strengths with GMCR’s innovative technology and beverage system expertise.”

“Our 2020 Vision calls for decisive and timely action to continuously improve and evolve our global system to best serve our customers and consumers around the world,” said Muhtar Kent, Chairman and Chief Executive Officer, The Coca-Cola Company. “This agreement demonstrates our creative approach to partnerships and ability to identify and stay at the forefront of consumer trends driving the industry. By pairing The Coca-Cola Company’s brand leadership and global footprint with GMCR’s innovative technology, together we will be able to capitalize on the many exciting growth opportunities in the single-serve, pod-based segment of the cold beverage industry. Importantly, this partnership provides our consumers with a convenient way to enjoy the brands they love through in-home preparation.”

The investment is expected to close in March 2014, subject to customary closing conditions, including receipt of required regulatory approvals.

GMCR’s Keurig Cold™ single-serve beverage system is currently under development with expected availability in GMCR’s fiscal year 2015. Keurig Cold™ will use precisely formulated single-serve pods to dispense freshly-made cold beverages including carbonated drinks, enhanced waters, juice drinks, sports drinks and teas in consumers’ homes with the one-touch simplicity, quality and variety that North American consumers love about the Keurig® brand hot system platform. The cold system is expected to be a similarly open-architecture platform like the Keurig® hot system.

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WarriorClass's picture

CT Collectivist Gun Grabber Ruthlessly Skewered By Sipsey Street Irregulars:

Boris Alatovkrap's picture

Soda Stream is make pick of wrong celebrity, is should replace Ms. Johansen with Client Number 9, Eliot Spritzer.

max2205's picture

Ten bucks says this is a Coke blunder

Droel's picture

As a aoda-addict, I agree.  I would love to shrink my beverage closet with little pods (provided they were cost effective which based k-cup pricing we know they are not), but most likely tgatvwon't be desireble as itbwill probably use a variation if the product in those new Coke dispensers that dispense 1000 flavors of soda.  Does anyone think those taste good?  To me, all of it tastes like it is chemically laced and is lacking in the intended flavor.  I think the only reason those machines have been successful is that it offers variety, convenience, and it may be cost effective for storage.  Judging by its taste, I think most people drink it because that is their option.  I however, avoid restauants that serve this unless I get take pout and don't get a drink.  ISure as heck wouldn't put it in my home.


On a side note, this will probably be forced down iur thriat in the name of profits>  Will the sheep continue to drink this inferior swine?


walküre's picture

You do know of the mid term and long term effects of sugar and sugar substitutes, don't you?

Putting soda in a tin to brew at home is just about the stupidest idea EVER. The water in the soda, the packaging and the transport is where the "value" is. The rest is crap.

Now they're brining crap to the market at the same or higher cost as the value product and people will probably buy it. Good for Cola etc. and the consumer is being trashed again.

Buy the pods, use your city water, use your electricty to produce yourself that drink and pay more for the pods plus the added cost of your water, your power and your labor.


pods's picture

I'd pay more for the pods.


El Oregonian's picture

Whoa. Coke, one line and it's GONE! Sorry Green Mountain Coffee Roasters, Coke will mainline and you'll get roasted.

Sorry. That's just how the big dogs play...

TruthInSunshine's picture

wtf with the "strategic partnership?"

Why doesn't Warren "Fuck You Taxpayer" Buffet's Coke just buy the damn company outright?

X_mloclaM's picture

strugglin for peeps to drank it

Seth Klarman pwning BRK.B face:

"Even among value investors there is ongoing disagreement concerning the appropriate margin of safety. Some highly successful investors, including Buffett, have come increasingly to recognize the value of intangible assets-broadcast licenses or soft-drink formulas, for example-which have a history of growing in value without any investment being required to maintain them. Virtually all cash flow generated is free cash flow.

The problem with intangible assets, I believe, is that they hold little or no margin of safety. If something goes wrong-tastes change or a competitor makes inroads-the margin of safety is quite low."

slaughterer's picture

When a stock with 31% float short goes up more than 50% in a  few minutes, you can bet there are people getting killed, and margin clerks will be a calling.  

Ban KKiller's picture

One is A SHIT PROUDUCT, The other WILL be SHIT product. Watered down shit....

Fuck Hannity...

DirkDiggler11's picture

Great link Whiskey / Charlie , thanks for Posting.

The time for collecting the "100 Heads" is certainly drawing nearer ...

ebworthen's picture

Keurig and Soda Stream make no sense to me.

People sure are a dumb bunch of monkeys.

Divided States of America's picture

Yes....overpay for liquid poison just dont make sense. But Americans like it....just look at the number of obese chumps walking about.

Boris Alatovkrap's picture

"number of obese chimp walk about"

There, is fix for you.

Boris Alatovkrap's picture

Boris is explain genius of Soda Stream. Soda Stream is make pure rush carbonation beverage. But is make in own house, so you are not to buy bottle at department store. You are not chip tooth remove bottle cap. Think of reduce of dental cost alone!

walküre's picture

Boris, you have proven time and again how your IQ is 15x higher than the average American who has IQ of 50 and rye bread has 60. Having said this, you must leave. You are overqualified to reside in America

Rainman's picture

A soda maker..? I just today bought a litre of club soda for a quarter. Losing !

Smegley Wanxalot's picture

Yeah, but this soda is fresh, baby!

Rainman's picture

what we really need is a cure for nail fungus !

Smegley Wanxalot's picture

Chef Tony markets a cure for that on his infomercials.

The Miracle Blade Nail Cure or something.

Boris Alatovkrap's picture

Cuba is make devise for cure of nail fungus. Every "rehabilitation facility" is utilize of specialize equipment. Dual purpose - also is use for trimming of Cigar.

1stepcloser's picture

What do they use to keep those 50ish cars still running...Always amazes me...

Boris Alatovkrap's picture

No corn ethanol additive. Pure is gasoline for Cuban automobile and truck. From Venezuela.

quasimodo's picture

Oil of Oregano twice a day. Works wonders for fighting many things that ail you, including cold, flu, sinus, etc.

bjfish's picture

Dr. suggested using vaseline for nail fungus ....

or was that for Obozocare  ?  Can't remember.

Diablo's picture

David Einhorn just ate his toupee on this news.



SgtShaftoe's picture

Folgers crystals in liquid form??  What tasteless dumbfucks drink this shit?  It's probably laced with corexit anyway. 

I can have my 4 shots of espresso with the push of 3 buttons in a little more than a minute from a $350 superautomatic machine, and it doesn't taste like weasel piss strained through a used balaclava. 

James_Cole's picture

I gave up on espresso machines after getting one of these:

SgtShaftoe's picture

I've got a biletti brand of that design.  It's ok.  I don't like the mess.  It's coffee is good though. 

Urban Redneck's picture

Something we agree on... (WTF???)

superflex's picture

I've been running my Saeco for 14 years.  Cant beat it unless the power is out.  

Then it's time to break out the porcelain coated percolator and the camp stove.

Both are messy

More_sellers_than_buyers's picture

wow...I played the short side my whole life.  This is the type of news that would keep me up at night.  Thank goodness I just play solitaire now on my ipad....

ThirdCoastSurfer's picture

Who is so stupid as to short a stock that unlimited funds cannot crush?

The HFT algo's are out there: searching, waiting, planning for the opportunity to crush anyone subject to a margin call. 

Thank you all who shorted GMCR, you just funded another day of salaries and bills for the squid. 

Seasmoke's picture

Would love to see, SodaStream an Israelhole based company , go to fucking Zero.

Balanced Integer's picture

You can't see it, but I am toasting you right now...

With a half-liter bottle of Ocean Spray Cran-Grape Soda...courtesy of my SodaStream.

Mozltov. Bitchez!

OC Sure's picture

Forget cute little plastic cups. Have a guzzle of the the KC futures instead.

chump666's picture

Half these companies shouldn't exist anyways. 

Central planners chime in:

*Fed's Lockhart: US stocks in correction mode, doubt market was bubble.

This is Rand's exceptionalism gone insane.  'Free market' overlords and the Titanic.

pragmatic hobo's picture

wait ... gmcr is issuing new shares?

syntaxterror's picture



Why doesn't ØBama halt trading now that it's spiked up over 10%?

Surely Ø's minions would halt trading if it dumped 10% or more. 

Godisanhftbot's picture

 Its the triumph of the Retards


 like bitcoin


 pay $50 a lb for $5 a lb coffee.


its a blivet

Godisanhftbot's picture

 Basically if you buy GMCR product you've failed the IQ test.

quasimodo's picture

Here is a novel idea. Drink more fucking water instead of the HFCS and crap laiden shit.

Al Huxley's picture

That's a good sign, right - when half the momo stocks jump 30 - 50% after hours, and the other half dump 20%+, again, after hours?  This is a sign that the capital markets are robust and doing their thing to establish fair market prices, right?

Godisanhftbot's picture

as soon as i posted gmcr tanked. must be karma

Robinhood's picture

I'd rather have a Green Mountain Barrel than a Green Mountain Coffee.  Drink Chock Full O Nuts my friends, you'll need them.

Magnum's picture

What is soda stream?

adr's picture

I'd keep the short position. Keurig machines are one of the greatest rippoffs in history. You can buy Swiss Miss hot chocolate pods for your Keurig, $11.99 for 12 pods. Or you can buy a box of twelve packs you mix in water for $1.75. A $10 Walmart special is built better than a $120 Keurig.

The Coke pods will work the same way. People might buy a machine thinking it would be convenient only to find out they are paying $.75 for a can equivalent. Soon they go back to the cans. Everyone I know with a Keurig uses thier own coffee with one of the aftermarket filters. Green Mountain even started to make thier own filter for sale to try and get something out of the deal.