Coca-Cola eyes sale of Costa Coffee’s UK business to TDR
Negotiations stall over valuation as Costa faces financial challenges.
Coca-Cola is in advanced discussions to sell Costa Coffee’s UK operations to private equity firm TDR Capital, according to reports from the Financial Times. The beverage giant selected TDR as its preferred bidder earlier this week, but talks over the deal’s value have reportedly stalled, raising uncertainty about whether an agreement will be reached.
TDR Capital, co-owner of EG Group and owner of UK supermarket chain Asda, has been negotiating to acquire Costa Coffee for around £2 billion. This figure is significantly lower than the £3.9 billion Coca-Cola paid Whitbread for the coffee chain in 2018, reflecting the brand’s recent struggles.
Costa Coffee reported a £13.8 million loss on £1.2 billion in sales in 2023, highlighting ongoing challenges in a competitive market. The company’s financial performance has fueled debate over its valuation and the future of Coca-Cola’s investment in the coffee sector.
If completed, the sale would mark a major shift for Coca-Cola, which has sought to diversify beyond soft drinks in recent years. However, with negotiations at a standstill, the outcome remains uncertain.
