Key facts
- Coca-Cola has hired restructuring firms Alvarez & Marsal and Alix Partners.
- The firms will advise on Costa Coffee's finances and conduct an operational review.
- The sale of Costa Coffee was abandoned in January 2026 due to offers below expectations.
- Costa Coffee's operating losses more than doubled to £13.5m in 2024.
- Coca-Cola acquired Costa Coffee for £3.9bn in January 2019.
Coca-Cola has engaged restructuring specialists Alvarez & Marsal and Alix Partners to advise on the financial and operational aspects of its coffee chain, Costa Coffee. This move follows the abandonment of a planned sale of Costa in January 2026, as bids from private equity firms did not meet Coca-Cola's expectations. The company had been seeking approximately £2 billion for the coffee chain, which it acquired from Whitbread for £3.9 billion in January 2019. Costa Coffee, which operates 2,700 shops across the UK and Ireland and employs 16,000 people in Britain, has faced financial challenges. Recent filings show that its operating losses more than doubled from £5.8 million to £13.5 million in 2024, on revenues of £1.2 billion, attributed to high street competition and reduced footfall. Other UK coffee retailers have also struggled with rising costs for beans and staffing, alongside increased competition. Pret, for instance, wrote down a third of its value following significant losses since its acquisition in 2018. Potential bidders in the final round of negotiations for Costa included TDR Capital, the owner of Asda, and Bain Capital Special, which owns Gail's Bakery and Pizza Express.