Coca-Cola has brought in two prominent restructuring consultancies to advise on Costa Coffee after a sale process ended in failure earlier this year.
Firms Alvarez and Marsal and Alix Partners, both with significant City of London presences, have been appointed to review the struggling coffee chain’s finances and operations.
The appointment follows an abandoned auction process that came to a halt in December 2025 after private equity bids came in well below Coca-Cola’s expectations.
The Coca-Cola Company originally acquired Costa in January 2019 following a deal with FTSE-100 company Whitbread, in a transaction worth £3.9bn.
Coca-Cola had reportedly been seeking roughly £2bn for the business when it began formal sale talks with bankers in August last year.
The final round of negotiations involved private equity firms including Asda owner TDR Capital and Bain Capital Special, the owner of Gails Bakery and Pizza Express.
According to The Times, Alvarez and Marsal and Alix Partners have been tasked with advising on Costa’s finances and conducting a full operational review of the business.
Costa, which operates 2,700 branches across the UK and Ireland and employs 16,000 people in Britain, has been struggling financially for several years.
The coffee chain’s operating losses more than doubled from £5.8m to £13.5m on revenues of £1.2bn in 2024, according to the most recent Companies House filings, with the company citing high street competition and low footfall.
Costa is far from alone in facing financial difficulty, as the wider UK coffee and casual dining sector has been battered by rising coffee bean prices, higher staffing costs, and fierce competition from both chains and independent operators.
Late last year, Pret wrote off a third of its value amid making £525m in losses since its 2018 acquisition by European investment group JAB, underscoring the pressure across the sector.
Alvarez and Marsal, Alix Partners, Costa, and Coca-Cola were all approached for comment on the latest developments.