Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Starbucks Corporation (SBUX), Green Mountain Coffee Roasters Inc. (GMCR), & More: Coffee Gets a Hot Dose of New Competition

The world is getting smaller, or at least more connected. In an odd reversal of business, it seems more and more brands are being consolidated under one big owner — almost the way it was in the early part of the 20th century. Yesterday, another massive company slipped under the waves, when D.E. Master Blenders agreed to sell itself off to Joh. A. Benckiser, or JAB.

Starbucks Corporation (NASDAQ:SBUX)

Never heard of JAB or Master Blenders, you say? That’s not really surprising, as both are European companies. But even if you don’t know them, you know their work, and with this purchase, you might know their wrath.

The Continental Congress
JAB is a sort of multiheaded beast of an investment arm, which buys and holds companies for the Reimann family. The Reimanns, in turn, are wealthy — about $20 billion net worth  — heirs to a chemical company fortune. JAB is a private investment arm, which works on its own and through three other vehicles:

Coty is a majority-owned beauty product company, which produces Calvin Klein, Adidas, and other designer perfumes.

Reckitt Benckiser is a home-products company, which manages dozens of brands, including Air Wick, Clearasil, and Old English in the United States.

The LABELUX Group owns Jimmy Choo and Bally and focuses on high-end fashion

The most recent buying spree has come from the root company, JAB. In the past year, it has purchased Peet’s Coffee and Tea for $975 million, Caribou Coffee for $340 million, and now Master Blenders for $9.8 billion. In less than one year, the company has amassed a multibillion-dollar global coffee position.

This is where we look out
That’s a good reason to be worried, if you’re an investor in Starbucks Corporation (NASDAQ:SBUX) or Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) or really any major coffee company. Master Blenders’ main line is a brand called Douwe Egberts, which used to be served in Burger King Worldwide Inc (NYSE:BKW) until the company signed with Seattle’s Best, a Starbucks brand.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.