Nestle Pays $7 Billion To Market Starbucks Products Worldwide

By Dave Fusaro, Editor in Chief

May 07, 2018

Cementing its reputation as a global leader in coffee, Nestle SA today (May 7) announced an agreement granting it perpetual rights to market Starbucks consumer and foodservice products globally, outside of the company’s coffee shops, for at least $7.15 billion.

The non-coffee shop business generated annual sales of $2 billion. The agreement excludes ready-to-drink products and all sales of any products within Starbucks coffee shops.

"This transaction provides Nestle with a strong platform for continued growth in North America with leadership positions in the premium roast and ground and portioned coffee businesses," the Nestle announcement said. "It also allows Nestlé to capture exciting new growth opportunities in the rest of the world with Starbucks premium products."

"This global coffee alliance will bring the Starbucks experience to the homes of millions more around the world through the reach and reputation of Nestle,” said Kevin Johnson, president and CEO of Starbucks.

The transaction does not include the transfer of any fixed assets. Approximately 500 Starbucks employees will join the Nestlé family, although its operations will continue to be located in Seattle. The two companies will work together on innovation and go-to-market strategies.