Coca-Cola to buy UK coffee chain Costa for $5.1 billion

Britain's Whitbread Plc said on Friday it had agreed to sell coffee chain Costa to Coca Cola for an enterprise value of £3.9 billion ($5.1 billion).

The deal was unanimously agreed by the Whitbread board to be in the best interests of shareholders, the company said in a statement. It acquired the chain in 1995, for £19 million when it had only 39 shops.

James Quincey, the Coca-Cola President and CEO, said that the deal gives his company new capabilities and expertise in coffee.

"Our system can create opportunities to grow the Costa brand worldwide. Hot beverages is one of the few remaining segments of the total beverage landscape where Coca-Cola does not have a global brand," he said in a statement.

Alison Brittain, the chief of hospitality company Whitbread, called the sale a "unique strategic opportunity to combine the Costa brand with Coca-Cola's global scale, product and distribution capabilities." She also reportedly told BBC Radio that she believed the company got a high price for the coffee chain.

This story is developing. Please check back for updates.

Correction: A previous headline on this story incorrectly stated the value of Coca-Cola's deal to buy Costa.

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