Nestle just paid $7 billion to sell Starbucks products


Nestle, known for its chocolate and Nescafe and Nespresso coffees, will now market Starbucks products beyond the confines of the famed coffee shop chain.

Starbucks and Nestles announced a partnership today that gives Nestle, “the perpetual global license of Starbucks consumer and foodservice products.”

The price for this perpetual license: $7.2 billion.

Starbucks generates annual revenue of about $2 billion per year.

The deal means Nestle gets to market Starbucks packaged coffee and tea products worldwide.

“This transaction is a significant step for our coffee business, Nestles’ largest high-growth category,” said Nestle CEO Mark Schneider in a prepared statement. “With Starbucks, Nescafe and Nespresso, we bring together three iconic brands in the world of coffee.”

“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 Starbucks President and CEO Kevin Johnson.

Bottom line: The coffee drinking consumer will be seeing more Starbucks brand products available in a variety of options, from single serving to multi-serving packages.

You can read more about the alliance at the Nestle or Starbucks Web sites.

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