Apollo decides against bid for Costa Coffee - report

(Sharecast News) - A small number of suitors have reportedly served up initial bids for Costa Coffee as owner Coca-Cola prepares to retain ownership of the brand's ready-to-drink portfolio, while Apollo Global Management was said to have changed its mind about submitting a bid. According to Sky News, Coca-Cola and its advisers set a deadline last week for indicative offers for Costa.

City sources told Sky on Monday that investment giant Apollo, which had expressed an interest in the business, decided not to submit an offer.

Other reported bidders include TDR Capital, the owner of Asda, although banking insiders said there had been a small number of proposals than expected.

One suggested that the value placed on Costa could be as low as £1.5bn, well under half the £3.9bn paid by Coca-Cola in 2021.

Sky said it was unclear whether Coca-Cola would be prepared to offload the business at that price.

Coca-Cola is said to have told suitors that it would retain control of the ready-to-drink Costa range sold in supermarkets and other grocery outlets.

Sky News revealed last month that Coca-Cola was exploring a disposal of Costa, which trades from more than 2,000 stores in the UK and well over 3,000 globally.

It has been reported to have a global workforce numbering 35,000, although Coca-Cola has not responded to any questions from Sky News about the Costa business or sale process.