NEWS: Coca-Cola Ends Plans to Sell Costa Coffee in Major Strategic Shift

The Coca-Cola Company has reportedly abandoned plans to sell Costa Coffee after receiving bids from private equity firms that fell short of its valuation expectations, according to the Financial Times.

The soft drinks giant is understood to have ended discussions with the remaining bidders in December, bringing to a close an auction process that had been underway for several months. The decision marks a pause in Coca-Cola’s efforts to divest the coffee chain, which it acquired in 2018 as part of a broader strategy to expand beyond carbonated beverages.

Sources cited by the Financial Times indicate that late-stage bidders included TR Capital, the owner of pub operator Stonegate, as well as Bain Capital’s special situations fund. Bain’s portfolio includes well-known UK brands such as bakery chain Gail’s and restaurant group PizzaExpress.

Coca-Cola had reportedly been seeking a valuation of approximately £2 billion for Costa Coffee. The chain operates more than 2,700 outlets across the UK and Ireland and is one of the country’s largest and most established coffee brands. The sought-after valuation would have represented roughly half of the £3.9 billion Coca-Cola paid to acquire Costa from Whitbread, the owner of Premier Inn, six years ago.

Earlier stages of the sale process attracted interest from a number of global private equity firms, including Apollo, KKR, and Centurium Capital, the owner of China’s Luckin Coffee chain. The sale was advised by investment bank Lazard.

Coca-Cola has not publicly commented on the decision to halt the sale. However, the move suggests the company may now look to retain Costa Coffee within its portfolio, potentially refocusing on operational improvements or longer-term growth opportunities before reconsidering any future divestment.