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Watch Out Starbucks, Coca-Cola Is Spending Big Bucks For A Spot In The US Coffee Game

Watch Out Starbucks, Coca-Cola Is Spending Big Bucks For A Spot In The US Coffee Game

Coca-Cola is buying Costa Coffee, Britain’s biggest coffee chain for $5.1 billion

With more people looking for healthy alternatives to sugary beverages, soda companies are looking to expand their business to include healthier options. The top two soda companies have both recently purchased smaller beverage companies - Pepsi bought Soda Stream for $3.2 billion and a week later Coca-Cola announced that it is buying Costa Coffee from Whitbread for $5.1 billion. Whitbread is a British hospitality company that owns a variety of hotels, coffee shops, and restaurant companies in the UK.  

 Photo courtesy of Costa Coffee

Photo courtesy of Costa Coffee

Alison Brittain, Whitbread’s CEO, says this deal is “great news for shareholders as it recognizes the strategic value we have developed in the Costa brand and its international growth potential and accelerates the realization of value for shareholders in cash.”  Costa Coffee has more than 3,800 stores but none in the United States. This Coca-Cola deal is definitely going to change that and could pose a potential threat to companies like Starbucks. 

Coca-Cola CEO, James Quincey, is excited about the purchase and said, “hot beverages is one of the few remaining segments of the total beverage landscape where Coca-Cola does not have a global brand…Costa give us access to this market through a strong coffee platform.” 

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How do you feel about Coca-Cola’s latest acquisition? Let us know in the comments section below and be sure to subscribe to The Sitch for more coffee news and other entertaining reads. 

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