Tea retailer David's Tea prepares for IPO: sources

Tue Feb 10, 2015 9:36am EST
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By Olivia Oran

(Reuters) - Privately held Canadian specialty tea retailer David's Tea, whose investors include Lululemon Athletica Inc LULU.O founder Chip Wilson, has selected banks for a potential initial public offering, according to two people familiar with the matter.

Goldman Sachs Group Inc GS.N, JPMorgan Chase & Co JPM.N and Bank of America Corp BAC.N have been assigned lead roles in the IPO, which could come later this year, the people said.

The sources asked not to be identified because the matter is private. David's Tea, Goldman Sachs, JPMorgan and Bank of America declined to comment.

Based in Montreal, privately held David's Tea was founded in 2008 by 28-year old David Segal and his cousin Herschel Segal, the founder of the Le Chateau Inc CTUa.TO clothing chain.

David's Tea sells over 150 types of tea, including exotic infusions from around the world, organic teas and infusions in more than 100 locations throughout the U.S. and Canada. It also sells a number of unique flavored teas including birthday cake, blueberry jam and chocolate chili chai.

David's Tea competes with Teavana, which was acquired in 2012 by Starbucks SBUX.O for $620 million.

The company's investors include Highland Consumer Fund and Wilson, who made a CAD $14 million minority investment in 2012.