Coca-Cola is reportedly exploring options to sell Costa Coffee, the UK’s largest coffee chain. This comes as the American beverage company engages with potential buyers through banking advisors, assessing a possible sale at a reduced price. Coca-Cola initially acquired Costa from Whitbread in 2018 for £3.9 billion, aiming to expand its coffee portfolio.
Since the acquisition, Costa has faced several challenges, including rising operational costs, particularly the price of coffee beans, and heightened competition from upscale coffee retailers. Analysts suggest that a sale could result in a significant financial loss for Coca-Cola, with estimates indicating that Costa might only fetch about £2 billion—nearly half the purchase price.
Coca-Cola’s CEO, James Quincey, acknowledged that Costa has not met the company’s expectations, stating that the brand “has not quite delivered.” He indicated that the company is in the process of reevaluating its strategies to find growth opportunities within the coffee sector. Reports indicate that Coca-Cola has been in discussions with a small group of potential bidders, including private equity firms.
To assist with the review and gauge interest from buyers, Coca-Cola has enlisted the investment bank Lazard. Preliminary offers are anticipated in early autumn, although the company may decide against pursuing a sale.
Despite its challenges, Costa Coffee generates significant revenue, reporting a turnover of £1.2 billion for the 2023 financial year, a 9% increase from the previous year. However, it also reported a pre-tax loss of £9.6 million, attributed to inflationary pressures and write-downs on investments. Founded in 1971, Costa was sold to Whitbread for £19 million in 1995. At present, it operates over 2,000 locations in the UK and employs around 18,000 individuals.
Source: https://www.theguardian.com/business/2025/aug/24/coca-cola-talks-sale-costa-coffee