ADVERTISEMENT

Shares in one of Britain's biggest coffee chains surge 20% after Coca-Cola announces $5.1 billion takeover

Costa Coffee said that Coca-Cola's offer is 16 times the chain's expected earnings for 2018. Coca-Cola currently has no presence in the coffee market, and wants to use the deal to expand into the space.

  • US beverage giant Coca-Cola will buy British coffee shop chain Costa in a surprise acquisition.
  • Costa, which is currently owned by Whitbread, is being sold for £3.9 billion ($5.1 billion).
  • Coca-Cola currently has no presence in the coffee market, and wants to use the deal to expand into the space.
  • Shares in Whitbread jump almost 20% at the open on the news.
ADVERTISEMENT

Coca-Cola has announced a surprise move to buy Costa Coffee, one of the UK's largest cafe chains, from current owners Whitbread for £3.9 billion ($5.1 billion).

Whitbread, which also owns budget hotel chain Premier Inn, said that its board

"This transaction is great news for shareholders as it recognises the strategic value we have developed in the Costa brand and its international growth potential and accelerates the realisation of value for shareholders in cash," Whitbread's chief executive

ADVERTISEMENT

One of the main drivers of the deal, Brittain said is that "they [Coca-Cola] want the coffee product, they have no coffee in their range." Brittain went on to say that Coca-Cola plans to sell Costa branded

FOLLOW BUSINESS INSIDER AFRICA

Unblock notifications in browser settings.
ADVERTISEMENT

Recommended articles

10 African countries that waste the most food in 2024

10 African countries that waste the most food in 2024

US troop withdrawal from Niger hangs in the balance

US troop withdrawal from Niger hangs in the balance

Detained Binance executives sue Nigerian authorities for human right violation

Detained Binance executives sue Nigerian authorities for human right violation

Nigeria's central bank increases minimum capital base for banks

Nigeria's central bank increases minimum capital base for banks

Sony’s creators convention redefines the creative landscape for content creators

Sony’s creators convention redefines the creative landscape for content creators

Exploring the popularity of progressive jackpot slots in Indonesia

Exploring the popularity of progressive jackpot slots in Indonesia

Egypt, Nigeria, and South Africa ranked as Africa's most polluted countries in new report

Egypt, Nigeria, and South Africa ranked as Africa's most polluted countries in new report

10 African countries with the lowest life expectancy according to the World Bank

10 African countries with the lowest life expectancy according to the World Bank

Kenyan women are more obese than their men - here’s why

Kenyan women are more obese than their men - here’s why

ADVERTISEMENT