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(Adds industry context)
By Lauren Hirsch
April 4 (Reuters) - JAB Holdings, the owner of Caribou Coffee and Peet's Coffee & Tea, is in advanced talks to acquire bakery chain Panera Bread Co as it expands its coffee and breakfast empire, a source familiar with the situation said on Tuesday.
JAB, which also owns coffee k-cup maker Keurig Green Mountain, could help Panera expand its breakfast business as it competes for the only growing meal in the fast-food industry.
The source requested anonymity because the talks are confidential. Luxembourg-based JAB, the investment vehicle of Germany's billionaire Reimann family, declined to comment. Panera also declined to comment.
St. Louis-based Panera, whose fresh offerings appeal to health-conscious consumers, has reported better-than-expected earnings per share for the last six quarters. Its stock has risen nearly 28 percent this year through last Friday, ahead of media reports on the talks.
Panera, which has 2,000 bakery cafes throughout the United States, has worked to remove artificial colors and preservatives from its menu. It has also faced increased competition for breakfast customers, as more restaurant chains cater to diners willing to pay for a cheap, fast breakfast but not a lunch or dinner.
In addition to breakfast stalwarts Starbucks Corp and Dunkin Brands Group Inc, fast-food restaurant have jumped onto the breakfast bandwagon. McDonald's Corp in 2015 added an all-day breakfast menu, and Yum! Brands Inc's Taco Bell last year added a $1 breakfast menu.
JAB has been building its breakfast and coffee empire for years. It became the largest pure-play by volume in 2015, when its created Jacobs Douwe Egberts in Europe, a joint venture that combined its D.E. Master Blenders 1753 business with the coffee business of U.S.-based Mondelez International Inc.
Since then, it has acquired other breakfast and coffee companies, including Krispy Kreme Doughnuts for roughly $1.35 billion and Green Mountain for $13.9 billion.
JAB also controls cosmetics company Coty Inc and luxury goods maker Jimmy Choo.
Restaurant acquisitions have picked up speed in recent months, as the industry faces the challenge of a rising minimum wage. Restaurant Brands International, which owns Burger King and Tim Hortons, in February announced a deal to buy Popeyes Louisiana Kitchen.
Darden Restaurants Inc, whose portfolio includes the Olive Garden and Longhorn Steakhouse chains, said in March it would buy casual dining chain Cheddars Scratch Kitchen.
Bloomberg first reported Panera was in advanced sale talks with JAB. (Reporting by Lauren Hirsch; Editing by Richard Chang and Leslie Adler)