Nestle, Starbucks close global licensing deal: Here what it means

Nestlé has closed the deal granting it access to perpetual global rights to market Starbucks good and products around the globe.

As per the association, the two companies will work closely together on the existing Starbucks range of roast and ground coffee, whole beans, instant and portioned coffee.

According to a company release, Nestlé will use the resources of both companies to enhance Starbucks’ product offering worldwide.

“This partnership demonstrates our growth agenda in action, giving Nestlé an unparalleled position in the coffee business with a full suite of innovative brands,” said Nestlé CEO Mark Schneider.

The alliance will also capitalize on the experience and capabilities of both companies to work on innovation with the goal of enhancing its product offerings for coffee lovers globally.

For Nestlé, the deal also strengthens its coffee portfolio in the North American premium roast and ground and portioned coffee business.

It also unlocks global expansion in grocery and foodservice for the Starbucks brand, utilizing the global reach of Nestlé.

“This global coffee alliance with Nestlé is a significant strategic milestone for the growth of Starbucks,” said Kevin Johnson, president, and CEO of Starbucks.

“Bringing together the world’s leading coffee retailer, the world’s largest food and beverage company, and the world’s largest and fast-growing installed base of at-home and single-serve coffee machines help us amplify the Starbucks brand around the world while delivering long-term value creation for our shareholders,” Kevin further added.

Some 500 Starbucks employees in the United States and Europe will join the Nestlé family, with the majority based in Seattle and London.

The international expansion of the business will be led from Nestlé’s global headquarters in Vevey, Switzerland.

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