(RTTNews) - Tuesday,Green Mountain Coffee Roasters, Inc. (GMCR: News ) said it has submitted a revised proposal to acquire Diedrich Coffee, Inc. (DDRX: News ) for $32 per share with a total value of approximately $265 million, an increase of $2.00 per share over GMCR's prior offer. Separately Diedrich confirmed the receipt of the revised offer from GMCR.

The move comes after its rival Peet's Coffee & Tea, Inc. (PEET: News ) offered to buy Diedrich for $32 per share based on Peet's closing price on November 20 of $38 per share.

Green Mountain's offer represents approximately 57% premium to Diedrich's closing stock price on Nov. 2, the last trading day before news emerged of a proposed tie-up between Diedrich and Peet's. The company said it intends to fully finance the transaction with cash on hand and its existing bank lines of credit.

GMCR anticipates that the transaction will be neutral to slightly accretive within the first twelve months following the close, excluding one-time transaction expenses, and accretive thereafter.

Prior proposal of the company represented a 47% premium to the closing market price of Diedrich common stock on November 2, and a 15% premium over the original cash and stock proposal from Peet's.

Lawrence Blanford, president and chief executive officer said, "We believe our revised offer constitutes a superior proposal to Peet's November 22, 2009 offer, as it provides Diedrich shareholders with a substantial all-cash premium as well as greater value and greater certainty and speed of closing. This transaction will build upon the success of GMCR's family of brands across North America and further advance GMCR's objective of becoming a leader in the highly fragmented and competitive coffee and coffee maker businesses."
The Board of Diedrich Coffee after reviewing the initial offer from GMCR of $30 per share had determined that it constituted a "Superior Proposal" to the terms of the existing merger agreement with Peet's and has decided to analyze both bids according to the terms of the agreement before taking a final decision.

Earlier Peet's signed a definitive agreement with Diedrich Coffee to acquire Diedrich in a cash-and-stock transaction valued at $26.00 per share or about $213 million, to enter into the rapidly growing single cup coffee market.

Diedrich, as per the agreement notified Peet's about the revised bid from GMCR, while Peet's in a separate release confirmed the receipt of the raised proposal notice.

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