Nestle set to sell first Starbucks coffee under $7.15 billion deal

VEVEY, Switzerland (Reuters) - Nestle will sell Starbucks-branded coffee at grocery stores and online in Europe, Asia and Latin America from this month as it seeks to increase its lead over rivals such as JAB. After last year's $7.15 billion cash deal for exclusive rights to sell the U.S

Reuters February 14, 2019 00:05:55 IST
Nestle set to sell first Starbucks coffee under $7.15 billion deal

Nestle set to sell first Starbucks coffee under 715 billion deal

VEVEY, Switzerland (Reuters) - Nestle will sell Starbucks-branded coffee at grocery stores and online in Europe, Asia and Latin America from this month as it seeks to increase its lead over rivals such as JAB.

After last year's $7.15 billion cash deal for exclusive rights to sell the U.S. chain's coffees and teas, Nestle will start selling Starbucks labelled coffee beans, roast and ground coffee and single-serve capsules for its Nespresso and Nescafe Dolce Gusto coffee makers.

These will be available at grocery stores and online in 14 markets, including Belgium, Brazil, Chile, China, Mexico, the Netherlands, South Korea, Spain and Britain, with more markets following later this year, the world's biggest food group said on Wednesday.

Asked whether the launch of Starbucks Nespresso capsules would help Nespresso return to double-digit growth, Patrice Bula, executive vice president and head of strategic business units, marketing, sales and Nespresso, told a media briefing: "Yes, I hope so, yes. We have huge ambitions."

He said he was also confident of accelerating Nestle's strong U.S. coffee business that was boosted by the Starbucks deal and saw strong potential in markets like India and China.

"It is a landmark for us, a new growth platform, a moment where we can accelerate in the premium segment," he said.

Starbucks, the world's biggest coffee chain, has been selling its coffee for use at home -- including a variety of roasts in whole beans, instant or ground versions as well as coffee pods for its Verismo brewers and JAB's Keurig K-Cup system -- across North America and in some international markets for years.

Nestle is building on this existing product range and taking it to new markets under the deal struck last May which allows Starbucks to focus on its cafes and Nestle, with its retail expertise, to bring Starbucks coffee to supermarket shelves around the world.

David Rennie, head of coffee, said Nestle could still consider strategic acquisitions in the coffee sector.

"Never say never, but we believe we have three iconic brands today and will focus on developing these."

Under last year's deal Starbucks, which is expanding in China and finally ventured into coffee-obsessed Italy in September, will have its out-of-home business managed by Nestle, while continuing to sell its ready-to-drink products directly.

Nestle is due to publish full-year results on Thursday.

(Reporting by Silke Koltrowitz; Editing by Alexander Smith and David Evans)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.