Starbucks and Nestlé announced the completion of a $7 billion deal on Tuesday that will give the Switzerland-based food giant rights to market the coffee-maker’s packaged goods around the world.
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The agreement covers Starbucks brands including Seattle’s Best Coffee, Teavana and Starbucks-branded K-cup pods, among other products. It does not include ready-to-drink products or anything sold within Starbucks store locations.
Nestlé has an existing coffee line, branded Nescafé, which offers a range of products from pre-packaged lattes to coffee machines. To that repertoire, it will now add Starbucks products, which have a significant amount of brand-recognition among consumers.
“With Starbucks, Nescafé and Nespresso we bring together the world’s most iconic coffee brands," Nestlé CEO Mark Schneider, said in a statement.
Starbucks president and CEO Kevin Johnson added that the deal would help his company “amplify” its brand since Nestlé is the largest food and beverage company in the world and also has the largest installed base of at-home and single-serve coffee machines.
As a result of the deal, about 500 Starbucks employees in the U.S. and Europe will transfer over to Nestlé, with the majority based in Seattle and London, the companies said.