Starbucks is selling its Seattle’s Best Coffee brand to Nestle for an undisclosed amount.
Nestle, which is based in Vevey, Switzerland, has been in a partnership with Seattle-based Starbucks since 2018 and already distributes Starbucks-branded coffee in more than 80 markets worldwide.
David Rennie, head of Nestle’s coffee brands, said acquiring Seattle’s Best will continue to build the company’s portfolio and offer customers more choice. Nestle also owns the Nescafe, Nespresso and Blue Bottle brands.
Starbucks acquired Seattle’s Best Coffee in 2003 for $72 million. The deal gave Starbucks a lower-priced brand and access to Seattle’s Best contracts with grocers and food service providers.
But Starbucks is currently focused on a costly makeover of its North American stores. The company said last month it plans to spend $450 million next year to make its stores more efficient.
The company has also spent more than $1 billion over the last year enhancing worker pay and benefits as it tries to head off a campaign to unionize its stores.
"We’re confident that Nestle will continue to grow the Seattle’s Best Coffee brand as we focus on our strategy to elevate the premium coffee experience for consumers through the Starbucks brand," said Michael Conway, Starbucks’ group president of channel development, in a statement.
Nestle and Starbucks said they expect the transaction to close later this year.