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By: Stocks To Watch
March 09, 2012 at 16:47 PM EST
Battle of the Brews: Green Mountain Responds to Starbucks’ Verismo
Starbucks (SBUX) made waves today on its surprise announcement of a new single-serve coffee maker, also capable of brewing complex drinks like espressos and lattes. Although Starbucks said it does not think that the new Verismo will hurt its relationship with Green Mountain Coffee Roasters (GMCR), it seems obvious that the system would be a [...]
Although Starbucks said it does not think that the new Verismo will hurt its relationship with Green Mountain Coffee Roasters (GMCR), it seems obvious that the system would be a competitor to the latter’s popular Keurig machines. The market certainly thinks so, as the shares tumbled more than 15% today.
However, Green Mountain isn’t taking the situation lightly, and filed the following statement with the Securities and Exchange Commission.
We recently learned of StarbucksÂ planned initiative in the espresso-based single-cup category. As previously announced, we are working with Luigi Lavazza S.p.A. (ÂLavazzaÂ) to co-develop a new single-serve espresso-based machine that we believe would complement our Keurig Single Cup Brewers. According to NPD Group for consumer market research data, espresso machines represented 2.7% of the total coffee and espresso maker units sold in the United States during calendar year 2011.
Prior to the press release issued by Starbucks yesterday and their subsequent public comments, however, we were not made aware of any additional capabilities of their planned espresso system. We look forward to learning more about StarbucksÂ new espresso system as it moves toward launch and to continuing to grow the single-serve filtered-coffee opportunity in North America with our Keurig system partners, including Starbucks.
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