NEW YORK (AP) -- Green Mountain Coffee Roasters Inc. has lifted its all-cash offer for Diedrich Coffee Inc. to $290 million, or $35 per share, topping a lower cash-and-stock bid from rival Peet's Coffee & Tea Inc., which offered $32.50 per share earlier this week.
Green Mountain's bid is up from its previous offer of $265 million, or $32 per share.
Diedrich, in a separate statement, said its board believes Green Mountain's offer is superior to Peet's offer.
Green Mountain's revised agreement includes a termination fee that could range from $8.5 million to $11.5 million. If the deal is terminated by either party, under certain circumstances the fee will be payable to Diedrich.
Diedrich said Peet's has until Monday to negotiate with Diedrich and amend its current offer. If Peet's fails to submit a new proposal favorable to Green Mountain's offer, then Diedrich said it will agree to Green Mountain's offer.
Peet's, in a separate statement, said it will consider alternatives over the next few days, but believes that its offer remains superior.
Peet's and Green Mountain have been bidding for Diedrich for a month, wanting Diedrich's license to produce single-serve coffee pods called K-Cups that are used in Keurig Inc.'s brewing system.
Peet's Coffee late Monday boosted its cash-and-stock offer to the equivalent of $32.50 per share, or $269 million. That is above the $32 per share, or $265 million, it offered last week.
Diedrich's board has said Green Mountain's previous $265 million, or $32 per share, all-cash offer was superior to the one made by Peet's because the value of Peet's bid can fluctuate based on its own stock price. That offer was up from Green Mountain's bid on Nov. 23 of $30 per share in cash, or $247 million.