Nestle will pay £5.3bn for the rights to sell Starbucks products as it aims to cement its place as the world’s largest hot drinks company.
The deal is worth £1.5bn in annual sales to Nestle, which owns Nescafe and Nespresso, and will give it a stronger foothold in the US.
Mega deal: Nestle will sell Starbucks bags of coffee and pods all over the world
Nestle will sell Starbucks bags of coffee and pods all over the world in a tie-up that follows a boom in demand for quality coffee at home.
Starbucks is the world’s biggest coffee shop chain. It will return £14.7bn in cash to shareholders by 2020 in share buybacks and dividends.
The deal should give both firms a greater share of the US coffee market – the world’s largest.
Nestle, which will take on 500 Starbucks staff, is the fifth-biggest player in the US, with a 5 per cent share, while Starbucks has 14 per cent.