Costa Coffee is being circled by a clutch of private equity firms hoping to snap up the chain in a potential £3billion bidding war.
Costa’s owner, Whitbread, which plans to split the chain off from the group and list it as a separate entity, has been approached informally over a potential buyout.
Those thought to be considering a move on Costa include heavyweight private equity groups Bain Capital, CVC and TPG.
Tasty target: Costa Coffee’s owner, Whitbread, which plans to split the chain off from the group and list it as a separate entity, has been approached informally over a potential buyout
Whitbread is pressing ahead with plans to spin off Costa in a separate listing on the London Stock Exchange.
But a private bid for the group, which is valued at between £2billion and £3billion, would have to be considered by the board.
Whitbread will remain the owner and operator of the hotels group Premier Inn following the split.
The company’s shares spiked yesterday as news of the potential bidding war emerged, rising nearly 1.2 per cent, or 49p, to 4233p.
Costa, which Whitbread acquired in 1995 from founders Sergio and Bruno Costa, has more than 2,400 outlets and has been embarking on an overseas expansion.
It is thought a private buyer would continue the expansion and tighten up the costs.
In April, Whitbread announced its proposals for Costa following pressure from the activist investor Elliott.
It said that it had decided to pursue a ‘demerger of Costa’ within two years.,
The policy emerged after Elliott became Whitbread’s largest shareholder and started agitating for a break-up of the group.
The hedge fund has been snapping up stakes in companies behind some of the best-known UK brands, demanding major changes.
Chief executive Alison Brittain said at the time that the separation would create long-term value for stakeholders.