Krispy Kreme launched a turnaround plan in August to deleverage its balance sheet, soon after ending its donut-sale partnership with McDonald’s, citing rising costs.
- Krispy Kreme expects to pay down debt using the proceeds from the sale.
- The sale is the first international refranchising agreement since the company launched its turnaround plan in August.
- The transaction is projected to close in the first quarter of 2026.
Donut maker Krispy Kreme (DNUT) announced on Friday it has reached an agreement to sell its Japan operations to Unison Capital for $65 million, marking its first international refranchising agreement since its turnaround plan launched in August.
Krispy Kreme, which had 89 locations and nearly 300 fresh delivery points across Tokyo, Osaka, and other major cities nationwide, said it expects to use proceeds to pay down debt after transaction-related fees and expenses. The transaction is projected to close in the first quarter of 2026.
“We are pleased to announce our first international refranchising agreement since launching our turnaround plan in August, marking meaningful progress on a key pillar of the plan,” said Josh Charlesworth, Krispy Kreme CEO.
The sale of the Japan business is an essential step toward greater financial flexibility and reduced debt, he added.
Turnaround Plan
Krispy Kreme launched a turnaround plan in August to deleverage its balance sheet, soon after ending its donut-sale partnership with McDonald’s, citing rising costs. It had also withdrawn its FY25 outlook in May.
Under the turnaround plan, the company intends to improve its financial flexibility through refranchising international markets and restructuring the joint venture in the Western U.S. It also aims to reduce capital intensity by using existing assets and focusing on profitable expansion of its presence in the U.S.
Rising inflation and economic uncertainty have put a dent in Krispy Kreme’s sales, especially in the U.S., as fewer customers visit its stores amid consumers' cost-cutting. In the third quarter (Q3), net revenue in the U.S. declined by 5.3% to $216.2 million compared to the year-ago quarter.
Krispy Kreme had cut 15% of its support center staff and 1,500 of its so-called DFD doors in an attempt to reduce costs and restructure its operations, according to a report.
How Did Stocktwits Users React?
Retail sentiment on Stocktwits for DNUT trended in “neutral” territory amid “low” message volume.
Shares in the company are down nearly 53% so far this year.
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