Coca-Cola makes a bid of $5.1 billion on Costa Coffee

Coca-Cola Co. has made a brave move of foraying into the coffee and retail outlets by placing a bid of $5.1 billion (3.9 billion pound) to purchase UK’s coffee retail chain, Costa Coffee. By far in eight years, this is Coca-Cola’s biggest acquisition. With this move, the soda giant will place itself in this viciously competitive java market.

In a mission to expand its business in hot beverages category, Coca-Cola will finish this historic deal in the first part of 2019. The company already own coffee chain retail brands, Georgia and Gold Peak.

Costa Coffe has more 3500 coffee shops across the globe. Coca-Cola will buy Costa Coffee brand from British firm Whitbread and that also in cash.

Costa Coffee was founded by brothers Sergio and Bruno Costa in London, 1971. Initially the company was operating as a wholesaler supplying roasted coffee to specialist Italian coffee shops and caterers. Later on, in 1995, it was acquired by British company Whitbread.

Touted as one of UKs biggest coffee retail chain, Costa Cofee has more than 2400 coffee shops all over UK. James Quincey- President and CEO, Coca-Cola has expressed that the soda company is willing to spend more in the hot beverages segment, adding that Coca-Cola has the potential of becoming a global brand in this segment.

In the previous financial year, Coca-Cola has generated an operating income of $9.7 billion on revenues of $35.4 billion.

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