Yesterday, Nestlé announced the first strong signal in its quest for growth through an agreement with Starbucks. And not just any agreement: a perpetual license on the American companys products, outside its network of coffee stores. The Swiss food and beverage giant now becomes the only distributor of Starbucks products outside the current network.
Nestlé has to pay 7.15 billion dollars for an activity representing approximately 2 billion dollars in annual sales. The acquirer will retrieve 500 employees but no fixed asset and expects a positive effect on earnings per share and organic growth by 2020. The finalization of the deal is expected later this year. The acquired activity will still be located in Seattle, Washington.
Products soon distributed by Nestlé
Nestlé, a global leader in the food and drink industry believes that this operation will enable them to expand in North America and strengthen its global momentum thanks to the Starbucks products. Both companies plan to work closely together on innovation and marketing strategies. With Starbucks, Nescafé and Nespresso, we are bringing together three iconic brands from the coffee world, Nestlé CEO Mark Schneider said. The ongoing buyback program is currently not questioned.