Sara Lee Corp has agreed to enter into a nine-year exclusive partnership with Philips on Philips-branded consumer coffee systems that will drive innovation and expansion into new markets for its Senseo coffee brand.
Sara Lee and Philips currently co-own the brand, with each company having a 50% stake. Under the terms of the agreement, Sara Lee will pay Philips a total amount of €170m.
Sara Lee and Philips have been working together on Senseo since 2001, with Sara Lee producing the coffee pods and Philips designing, manufacturing and distributing the single-serve machines. Together, the two companies have built Senseo into one of the single-serve coffee systems, with over 33 million appliances sold worldwide.
Upon closing, Sara Lee will have full control of the Senseo trademark, and is expected to expand into new coffee segments and markets. Philips will continue to design, manufacture and distribute all Senseo machines over the next nine years.
Jan Bennink, executive chairman of the board, Sara Lee Corp, said: “This acquisition and partnership allow us to strengthen our relationship with Philips to focus on innovation in coffee technology and aggressively push geographical expansion. Philips’ long history of innovation, combined with superior retail strength in our key markets, makes it the perfect partner to work with as we take Senseo to the next level.”