Coca-Cola buys coffee chain Costa for $5.1 billion

2nd September, 2018 10:54:48 printer

Coca-Cola buys coffee chain Costa for $5.1 billion

LONDON: Coca-Cola recently said it had agreed to buy international coffee chain Costa from its UK owner Whitbread, in a deal that gives the beverages behemoth its first global coffee brand, reports AFP.

“Hot beverages is one of the few remaining segments of the total beverage landscape where Coca-Cola does not have a global brand. Costa gives us access to this market through a strong coffee platform,” Coca-Cola chief executive James Quincey said in a joint statement.

The deal for £3.9 billion ($5.1 billion, 4.3 billion euros) comes as consumer demand for conventional carbonated drinks shrinks in the US and other markets owing to health and obesity concerns.

Earlier in August, Coca-Cola’s arch-rival PepsiCo struck a deal to buy Israeli company SodaStream for $3.2 billion—in a pitch to consumers concerned about mounting waste from soda cans and plastics in landfills worldwide.

SodaStream makes machines that carbonate home tap water.

Coca-Cola’s purchase adds to its Georgia coffee brand in Japan and the US group’s coffee products in other countries.

“Costa also provides Coca-Cola with strong expertise across the coffee supply chain, including sourcing, vending and distribution,” the soft drinks giant added.

Coca-Cola hopes to close the deal in the first half of next year, subject to shareholder and regulatory approvals.