Nestle to sell first Starbucks coffee under USD 7.15 billion deal

Nestle will sell Starbucks-branded coffee at grocery stores and online in Europe, Asia and Latin America from this month as it seeks to increase its lead over rivals such as JAB.

After last year’s $7.15 billion cash deal for exclusive rights to sell the US chain’s coffees and teas, Nestle will start selling Starbucks labelled coffee beans, roast and ground coffee and single-serve capsules for its Nespresso and Nescafe Dolce Gusto  coffee makers. These will be available at grocery stores and online in Belgium, Brazil, Chile, China, Mexico, the Netherlands, South Korea, Spain and Britain, with more markets following later this year, the world’s biggest food group said on Wednesday. 

Asked whether the launch of Starbucks Nespresso capsules would help Nespresso return to double-digit growth, Patrice Bula, executive vice president and head of strategic business units, marketing, sales and Nespresso, told a media briefing: “Yes, I hope so, yes. We have huge ambitions.” 

Starbucks, the world’s biggest coffee chain, has been selling its coffee for use at home -- including a variety of roasts in whole beans, instant or ground versions as well as coffee pods for its Verismo brewers and JAB’s Keurig K-Cup system -- across North  America for years. 

Nestle is building on this existing product range and taking it to new markets under the deal struck last May which allows Starbucks to focus on its cafes and Nestle, with its retail expertise, to bring Starbucks coffee to supermarket shelves  around the world. Under last year’s deal Starbucks, which is expanding in China and finally ventured into coffee-obsessed Italy in September, will have its out-of-home business managed by Nestle, while continuing to sell its ready-to-drink products directly. Nestle is due to publish full-year results on Thursday.