Peet’s Coffee & Tea is buying a majority stake in Intelligentsia Coffee. Financial Terms were not disclosed. The target’s management team will keep a stake in the company.

Intelligentsia, founded in 1995 and based in Chicago operates 10 cafes across Chicago, Los Angeles and New York. The company also sells wholesale packaged premium coffee.

For Peet’s, the acquisition is part of its growth strategy to expand in the premium coffee market. “It’s important that we offer differentiated craft coffee brands with unique propositions and appeal,” says Peet’s CEO Dave Burwick. Intelligentsia will continue to operate independently.

The deal follows up Peet’s recent purchase of Stumptown Coffee Roasters from TSG Consumer Partners. Peet’s, which operates more than 200 stores, is owned by investment firm JAB Holding Co. In 2014, Peet’s purchased Might Leaf Tea. JAB acquired Peet’s in 2012 for $1 billion.

Coffee and tea deals have been picking up in the last couple of years. Starbucks Corp. (Nasdaq: SBUX) won Mergers & Acquisitions’ 2013 M&A Mid-Market Award for Deal of the Year for its $620 million purchase of Teavana.

Piper Jaffray & Co. (NYSE: PJC) and Kirkland & Ellis LLP are advising Intelligentsia. Skadden Arps Slate Meagher & Flom LLP is representing Peet’s.

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