Coca Cola Explores Possible Sale of Costa Coffee

Coca-Cola is the U.S. soft drinks company best known for its sodas now thinking about selling Costa Coffee. The company has hired investment bank Lazard to look at different options for the future of the coffee chain. This could include a complete sale, but no final decision has been made yet.

According to reports from Sky News and Reuters, Coca-Cola has already started early discussions with a few potential buyers, including private equity firms. Offers for Costa Coffee are expected to come in during autumn, though a sale is still uncertain.

Costa Coffee’s Global Presence

Costa Coffee is a British brand which operates in around 50 countries and has more than 3,000 stores worldwide, with over 2,000 in the UK alone. Coca-Cola bought the company in 2018 for $5.1 billion as part of its plan to grow beyond sodas and compete in the global coffee market with rivals like Starbucks and Nestle.

Why Coca-Cola is Rethinking Costa

Coca-Cola’s CEO James Quincey recently admitted that Costa Coffee has not performed as well as the company had hoped. While Costa’s stores are doing well, other parts of the business like ready-to-drink coffee and coffee machines have not grown as quickly as expected.

Quincey said the company is now reflecting on what it has learned and is considering new ways to expand in the coffee market. He also emphasized that Coca-Cola still wants Costa to succeed since it invested a huge amount of money in it.

Wider Food Industry Trends

The possible sale comes at a time when many food and beverage companies are making big changes. With rising inflation and more customers looking for healthier options, companies are reshaping their businesses and making deals to stay competitive.

In the United States, Coca-Cola is also making changes to respond to health concerns. The company recently agreed to use real cane sugar in its drinks, supporting the “Make America Healthy Again” campaign led by Health Secretary Robert F. Kennedy Jr. This reflects the growing demand for healthier ingredients and products in the food and beverage industry.

 

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