Kraft to sell Maxwell House K-cups for Keurig

Thu Oct 11, 2012 4:24pm EDT
 
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By Martinne Geller

NEW YORK (Reuters) - Kraft Foods Group Inc KRFT.O plans to sell Maxwell House and Gevalia single-serve coffee pods compatible with Keurig brewing systems, in another blow to Keurig parent Green Mountain Coffee Roasters Inc GMCR.O.

The pods are not licensed by Keurig or affiliated in any way, Kraft spokesman Basil Maglaris told Reuters. That means that Green Mountain will not receive any royalties from their sale.

The move by Kraft, which also owns the rival Tassimo single-serve brewer, represents the first time a big-name coffee brand has skirted Green Mountain in making cups for its market-leading system. Certain Green Mountain patents related to the design of its K-Cups expired in September, paving the way for a wave of competitors.

For its part, Green Mountain says consumers trust the official Keurig seal.

"We believe Green Mountain and the Keurig brand are very well-positioned to continue our industry leadership by revolutionizing the way consumers prepare and enjoy quality specialty coffee and other beverages," said Suzanne DuLong of Green Mountain.

Maxwell House is the third-largest retail coffee brand in the United States behind No. 1 Folgers, which is owned by J.M. Smucker Co (SJM.N: Quote), and No. 2 Starbucks (SBUX.O: Quote), according to market research firm Euromonitor International.

For a graphic showing companies' market shares: link.reuters.com/hyk33t.

The news was not unexpected, and Green Mountain shares recovered after initially falling. They finished regular trading on Thursday up 0.9 percent at $22.27.   Continued...

 
Green Mountain Coffee single-serve K-Cups are pictured with a coffee cup in New York, in this May 3, 2012 file photo. Kraft Foods Group Inc plans to sell Maxwell House and Gevalia K-cup single-serve coffee pods compatible with Keurig brewing systems, a spokesman said October 11, 2012, in another blow to Keurig parent Green Mountain Coffee Roasters Inc. REUTERS/Brendan McDermid/Files