Royal Cup Moves to Acquire Farmer Brothers in All-Cash Deal

Alabama’s Royal Cup Coffee & Tea plans to acquire Farmer Brothers Coffee Co. in an all-cash deal that would take the publicly traded Texas-based company private.

The companies said Royal Cup will pay $1.29 per share for all outstanding Farmer Brothers stock, with closing expected in the second quarter of 2026, pending approval from Farmer Brothers shareholders and other conditions. 

As of Dec. 31, 2025, Farmer Brothers had 21,720,306 shares outstanding, which would translate to a value of roughly $28 million at $1.29 per share. 

The agreement comes three months after Royal Cup announced an undisclosed investment from the Dallas-based firm Braemont Capital to support nationwide growth and expand production capacity. 

The deal would combine two longtime B2B competitors and legacy U.S. coffee suppliers with activities in foodservice, hospitality, office coffee, convenience and private-label channels. Announcements from the companies dated March 4 framed the merger as a joining of forces in roasting, national distribution, and beverage equipment and service. 

“This is a transformational and strategic step, which we believe materially strengthens our competitive position and advances our long-term growth strategy,” Royal Cup President and CEO Chip Wann said. 

Founded in 1896, Royal Cup says it offers “one of the nation’s most extensive food service and office coffee route delivery systems,” while also maintaining coffee sourcing, roasting and packing operations. 

Farmer Brothers, which operated for more than a century in California before relocating to the Dallas-Fort Worth Metroplex, has operated as a national roaster, wholesaler, equipment service provider and distributor for numerous business segments. 

In 2023, the company sold its Texas coffee production and distribution facility to Illinois-based TreeHouse Foods for $100 million. 

Farmer Brothers also owns other consumer and B2B coffee brands including: Boyd’s Coffee, which it acquired in 2017; West Coast Coffee, which it acquired in 2017; and the in-house Sum>One specialty coffee brand, launched last year. 

Farmer Brothers enters this deal after mixed financial results in recent years. In the company’s most recent full fiscal year, ended June 30, 2025, net sales were essentially flat at $342.3 million. Gross margin improved and adjusted EBITDA rose to $14.8 million, although the company still posted a net loss of $14.5 million.

Results weakened in the first half of fiscal year 2026. For the six months ended Dec. 31, 2025, Farmer Brothers reported $170.5 million in net sales, down from $175.1 million a year earlier, while net loss widened to $8.9 million from $4.8 million.

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