Coca-Cola makes a move on coffee

The Coca-Cola Company has bought British coffee chain Costa from Whitbread in a deal worth £3.9 billion.

By purchasing the UK’s largest coffee chain, Coke is looking to expand beyond fizzy drinks and wants to gain access to Costa’s coffee “platform” across Europe, Asia Pacific, the Middle East and Africa.

 

Costa currently operates just over 4,000 retail outlets, its Costa Express vending operation, for-home coffee formats and a roastery.

Coca-Cola CEO James Quincey said: “Costa gives Coca-Cola new capabilities and expertise in coffee, and our system can create opportunities to grow the Costa brand worldwide.  Hot beverages is one of the few segments of the total beverage landscape where Coca-Cola does not have a global brand. Costa gives us access to this market with a strong coffee platform.”

He went on to explain why Coke had chosen Costa: “Because Costa is a good fit – and the best way – for Coca-Cola to add a global coffee “platform” that will complement our existing system. Let me be very clear about why I use the word ‘platform’ and not ‘brand’. A platform means Costa isn’t just one thing. Not just a brand. Not just a retail operation. Not just vending. Not just a coffee roaster.

“A platform is all of those things and more. Costa is a platform with a great supply chain in coffee, a world-class roastery, a strong retail presence and a vending system. Costa has strengths in many countries and in many key distribution channels of the coffee business.”

Costa’s Managing Director Dominic Paul said: “Costa is a fantastic business with committed and passionate associates, a great track record and enormous global potential. Being part of the Coca-Cola system will enable us to grow the business farther and faster.

“I would like to say a huge thank you to our customers and to everyone in the Costa team who have helped us build the business to this position, and I look forward to the next exciting chapter in Costa’s vision of Inspiring the World to Love Great Coffee.”

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