Deals

Coke Makes $5.1 Billion Bet on Coffee Market With Costa Deal

Soft-drink giant gains its first global brand in coffee
Coke, Pepsi seek alternatives as sugary-soda demand wanes

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Coke’s caffeine hit: Bloomberg’s Lisa Pham reports.(Source: Bloomberg)

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By Thomas Mulier

August 31, 2018 at 6:16 AM UTC

Updated on

August 31, 2018 at 1:56 PM UTC

This article is for subscribers only.

Coca-Cola Co. is making an audacious move into coffee and retail outlets with the 3.9 billion-pound ($5.1 billion) purchase of U.K. chain Costa, its biggest acquisition in eight years and a push into the fiercely competitive java market.

The soft-drinks company swooped in after Whitbread Plc announced a plan in April to spin off the business. The transaction gives Coca-Cola instant heft in a business from which it was all but absent, with 3,800 stores in 32 countries and a foothold in China. Highlighting Coke’s desire to close the deal, Whitbread CEO Alison Brittain said the two sides signed just minutes before the announcement, after Coke first approached the other party in June.

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