Coca-Cola Co has agreed to buy the world’s second-largest coffee chain, Costa Coffee, from Britain’s Whitbread PLC for an enterprise value of ￡3.9 billion (US$5.1 billion), opening a new front in its push away from traditional sodas.
Whitbread yesterday said in a statement that the deal, which is to give Coke almost 4,000 coffee outlets in the UK and across Europe, has been agreed unanimously by the Whitbread board as in the best interests of shareholders.
Whitbread, which had been in the process of demerging its coffee business from its hotel chain, acquired Costa in 1995 for ￡19 million when it had only 39 shops.
Photo: AFP
For Coca-Cola, the deal adds to its efforts to move away from fizzy drinks toward healthier options for increasingly health-conscious consumers.
“Hot beverages is one of the few segments of the total beverage landscape where Coca-Cola does not have a global brand,” Coca-Cola chief executive officer James Quincey said. “Costa gives us access to this market with a strong coffee platform.”
Makers of soft drinks are branching out as consumers seek alternatives to sugary sodas. Earlier this month, PepsiCo Inc agreed to pay US$3.2 billion for SodaStream Ltd, which makes carbonated-water dispensers.
Costa outranks Starbucks Corp in the UK and is expanding in markets such as China. The company was one of the few big coffee chains up for sale after Nestle SA and the Reimann family’s investment company JAB Holding Co both went on an acquisition spree in the segment.
Coca-Cola sells coffee under the Georgia brand in Japan and has some other local products for specific markets.
Whitbread said it would reduce debt and contribute to the pension fund with the proceeds from the deal, and further expand its hotel chain Premier Inn in the UK and Germany.
“The announcement today represents a substantial premium to the value that would have been created through the demerger of the business and we expect to return a significant majority of net proceeds to shareholders,” Whitbread chief executive officer Alison Brittain said.
Additional reporting by Bloomberg
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
While China’s leaders use their economic and political might to fight US President Donald Trump’s trade war “to the end,” its army of social media soldiers are embarking on a more humorous campaign online. Trump’s tariff blitz has seen Washington and Beijing impose eye-watering duties on imports from the other, fanning a standoff between the economic superpowers that has sparked global recession fears and sent markets into a tailspin. Trump says his policy is a response to years of being “ripped off” by other countries and aims to bring manufacturing to the US, forcing companies to employ US workers. However, China’s online warriors
RSS