Asda Owner TDR Capital Reported Potential Bidder for Costa Coffee Sale

TDR Capital, the private equity owner of Asda, is among several potential bidders considering an acquisition of Costa Coffee as Coca-Cola explores a sale of the UK’s largest coffee chain. Coca-Cola purchased Costa in 2018 for £3.9 billion but has faced challenges with rising costs, stronger competition, and declining sales, prompting a reassessment of its investment, with CEO James Quincey stating the brand has "not quite delivered" as expected. Alongside TDR Capital, other interested parties include Apollo Global Management, Chinese investment group Citic, and U.S. buyout firm KKR, with Lazard advising Coca-Cola on the sale. TDR had previously shown interest in Costa in 2018 through its EG Group forecourt business and is looking to add the coffee chain to its portfolio, which already includes Asda, Stonegate pubs, and David Lloyd gyms. Coca-Cola may retain a partial stake post-sale, reflecting a strategic retreat from a market it initially sought to dominate. The sale talks come amid a 3% decline in Costa's coffee sales in the UK, highlighting the challenges Coca-Cola faces in the coffee sector.