Nestlé to start selling Starbucks coffee around the world
Starbucks plans to use the proceeds to accelerate share buybacks and now expects to return about $20bn in cash to shareholders
Zurich — Nestlé will pay Starbucks $7.15bn as part of a global coffee alliance in which the Swiss-based food giant is getting the rights to market the US coffee company’s products around the world outside Starbucks coffee shops. Starbucks said on Monday it would use proceeds to speed up share buybacks. The deal would add to earnings per share (EPS) by 2021 at the latest, it said. Nestlé expects it to add to earnings by 2019. Nestlé and Starbucks are joining forces in a highly fragmented consumer drinks category that has seen a string of deals lately. JAB Holdings, the private investment firm of Europe’s billionaire Reimann family, has fueled the consolidation wave with a series of deals including Douwe Egberts, Peet’s Coffee & Tea and Keurig Green Mountain, narrowing the gap with Nestlé. "This global coffee alliance will bring the Starbucks experience to the homes of millions more around the world through the reach and reputation of Nestlé," Starbucks CEO Kevin Johnson said. Coffee ...
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