Group 1 - Coca-Cola has abandoned the sale of Costa Coffee due to private equity bids falling short of expectations, concluding the auction process that lasted several months [1] - The sale target price set by Coca-Cola for Costa was approximately £2 billion, which is about half of the £3.9 billion acquisition price from Whitbread Group in 2018 [1] - The remaining bidders in the later stages included TDR Capital, the parent company of Asda, and Bain Capital's special situations fund, while Apollo, KKR, and Hillhouse Capital participated in the early bidding process [1] Group 2 - During Coca-Cola's ownership, Costa faced competition from high-end independent coffee shops and budget coffee operators like Greggs [2] - In 2024, Costa reported revenues of £1.2 billion, with operating losses widening to £13.5 million, attributed to low foot traffic in commercial areas and intensified competition [2] - The coffee industry in the UK is also facing pressures from rising coffee bean prices and increasing labor costs, with a national insurance contribution increase effective in April 2025 further burdening businesses [2] - Costa recorded a £48.6 million impairment loss related to its operations in China due to lower-than-expected demand in Shanghai, and an additional £51 million impairment for its Costa Express self-service coffee machine business [2] - The termination of the sale coincides with a leadership transition at Coca-Cola, as COO Henrique Braun is set to replace James Quincey as CEO in March 2026, with Quincey becoming executive chairman [2] - Quincey acknowledged in July 2025 that Costa had not delivered the expected value for Coca-Cola, and there are indications that Coca-Cola may consider restarting the sale of Costa in the medium term [2]

Group 1 - Coca-Cola has abandoned the plan to sell Costa Coffee due to the private equity bidders' offers not meeting expectations, marking another setback for the company during its ownership of the struggling UK coffee chain [1] - The auction process for Costa Coffee was halted in December, with TDR Capital and Bain Capital among the late-stage bidders [1][2] - Coca-Cola had set a sale target price of approximately £2 billion for Costa Coffee, which is about half of the £3.9 billion it paid for the chain in 2018 [1] Group 2 - If a deal with TDR Capital had been reached, Coca-Cola would have retained a minority stake in Costa Coffee [2] - Costa Coffee operates over 2,700 stores in the UK and Ireland, and the decision to terminate the sale coincides with the upcoming leadership change at Coca-Cola [2] - Coca-Cola's CEO acknowledged that Costa Coffee "failed to deliver the expected results," indicating potential plans to restart the sale process in the medium term [2] Group 3 - Costa Coffee's revenue for 2024 is projected at £1.2 billion, but the company has reported a significant increase in operating losses to £13.5 million, attributed to low foot traffic and intense competition from budget rivals [3] - The UK coffee industry is facing challenges from rising coffee bean prices and increased labor costs, exacerbated by a recent hike in employer national insurance contributions [3] Group 4 - The failure of the sale plan may force Coca-Cola to write down the asset value of Costa Coffee on its balance sheet [4] - Costa Express, the self-service coffee machine business, recorded a £51 million impairment due to the decision to discontinue "some prototypes" [4]