Art of the secret deal: Is Starbucks still a player in Tully's sale?

Credit: Teresa Yuan / KING 5 News

Actor Patrick Dempsey shares coffee with fans at a Tully's in Seattle, Jan. 4, 2012. Dempsey was part of an investor group that purchased the coffee chain, which filed for bankruptcy.

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by CHRIS INGALLS / KING 5 News

kgw.com

Posted on January 11, 2013 at 11:26 AM

Updated Friday, Jan 11 at 11:29 AM

Documents filed Thursday in federal bankruptcy court could throw cold water on actor Patrick Dempsey’s plan to sell hot coffee in Seattle.

The documents show a significant change of heart by one of the key players in the sale of the Tully’s coffee franchise.

Green Mountain Coffee Roasters supplies coffee beans to the Tully’s franchise and holds the Tully’s name. TC Global, Tully's parent company, owns the equipment, product and franchise locations.  But only Green Mountain can sell or license the Tully's name.

In the court filing, Green Mountain now says it will not oppose the sale of Tully’s to Starbucks and its partner. Green Mountain opposed the sale to Starbucks during a bankruptcy auction in Seattle last week. Green Mountain said it still is in support of the sale to Dempsey’s group, Global Baristas, as well.

A source close to the dealings said Green Mountain did not want to sell to Starbucks because Starbucks uses a different bean supplier. The source presumes that Starbucks has been pressuring Green Mountain to withdraw its opposition in the week since the auction took place. Starbucks sells Green Mountain products in its stores and could use that as leverage.

Starbucks spokesman Zack Hutson denied the company exerted any pressure on Green Mountain, which supplies product to Starbuck's stores as well.  Hutson did say Starbucks had been in contact with Green Mountain, however.

Hutson says Green Mountain's blessing puts Starbucks in a better position at Friday's hearing.

Starbucks offered a higher purchase price for Tully's last week.  However, because of Green Mountain’s opposition it was not determined to be the best bid.

Bankruptcy judge Karen Overstreet is expected to decide on which offer is the highest and best bid during a hearing Friday in Seattle.

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