Philz Coffee has signed an agreement to be acquired by private equity firm Freeman Spogli.

Terms of the transaction were not officially disclosed. However, sources say the acquisition is valued at approximately $145 million.

The San Francisco-based coffee chain, founded in 2003 by Phil Jaber and his son Jacob, has grown from a single café in the Mission District to various locations across California and Chicago. It also operates wholesale and online sales channels, all supported by a local roasting facility in Oakland, California.

Philz will continue to be led by CEO Mahesh Sadarangani, who joined the company in 2021, along with the existing leadership team. The company said its management and staff will remain in place following the acquisition.

Sadarangani said: "This is an exciting new chapter for Philz as we expand and continue our mission to deliver a high-quality, personalised coffee experience to our loyal customers. Freeman Spogli's deep experience in the consumer and restaurant sectors, along with their collaborative approach, makes them an ideal partner as we look to expand our footprint and continuously improve our offerings. We're proud of the strong foundation we've built and look forward to accelerating our growth together."

Freeman Spogli, which has invested in brands such as Popeyes Chicken, El Pollo Loco and Floor & Decor, said Philz Coffee has strong potential for expansion in the specialty coffee market.

"Philz is a beloved brand with a passionate customer base, distinctive, handcrafted coffee offerings and significant room for expansion," said Brad Brutocao, partner at Freeman Spogli. "We are committed to preserving and building upon Philz' rich heritage and will continue delivering the unique, authentic coffee experience that makes the brand so special. We believe the company is well-positioned for meaningful growth in the attractive and growing specialty coffee category, especially with Mahesh and the talented Philz team to help drive this new chapter of success."

Jacob Jaber added: "From day one, Philz has been known for its distinct approach to coffee and the community it has cultivated around the brand. It was personally important to us to find a partner that fully appreciates and is firmly committed to our mission."

"With continued leadership from Mahesh and the customer-focused approach of Freeman Spogli, Philz is well positioned to continue scaling while staying true to what makes it special."

The transaction is expected to close on 6 August 2025.

Top image: © Philz Coffee