Coca-Cola is to buy the Costa coffee chain from owner Whitbread in a deal worth £3.9bn. Whitbread had intended to spin off the chain as a separate firm, but said a straight sale was more profitable. Chief executive Alison Brittain said Whitbread would now focus on its Premier Inn business in the UK and Germany. Whitbread bought Costa, which is now the UK's biggest coffee chain, for just £19m in 1995. At the time, it had just 39 outlets. It now has more than 2,400 UK coffee shops, as well as some 1,400 outlets in 31 overseas markets. Costa Express has 8,237 vending machines worldwide. As well as being the largest UK coffee chain, Costa is also the world's second largest. It is looking to triple its presence in China, where it is second to Starbucks. According to consumer analysts Kantar Worldpanel, the out-of-home coffee market is worth £6.3bn a year in the UK alone. While this is a landmark deal for Whitbread, it is also a significant move for Coca-Cola, taking it into hot beverages for the first time and, it hopes, providing the growth for which its investors have been crying out.
