The funding big which owns Wagamama eating places is among the many potential suitors circling Costa, Britain’s greatest excessive road espresso chain.
Sources near the method mentioned it remained at a really early stage, with indicative bids not due for a number of weeks.
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Apollo may not determine to pursue a proper provide for Costa, the sources mentioned.
KKR, one other US-based non-public fairness big, has additionally spoken to Lazard, Coca-Cola’s adviser, however was unlikely to desk a agency bid for Costa, they added.
Costa trades from greater than 2,000 shops within the UK, and properly over 3,000 globally, in response to the most recent obtainable figures.
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Analysts imagine a sale may crystallise a multibillion pound loss on the £3.9bn sum Coca-Cola agreed to pay to purchase Costa from Whitbread, the London-listed proprietor of the Premier Inn resort chain, in 2018.
One advised that Costa may now command a price ticket of simply £2bn in a sale course of.
Accounts filed at Firms Home for Costa present that in 2023 – the final 12 months for which standalone outcomes can be found – the espresso chain recorded revenues of £1.22bn.
Whereas this represented a 9% enhance on the earlier 12 months, it was beneath the £1.3bn recorded in 2018, the ultimate 12 months earlier than Coca-Cola took management of the enterprise.
Coca-Cola has been grappling with the weak efficiency of Costa for a while, with Mr Quincey saying on an earnings name final month: “We’re in the mode of reflecting on what we’ve learned, thinking about how we might want to find new avenues to grow in the coffee category while continuing to run the Costa business successfully.”
“It’s still a lot of money we put down, and we wanted that money to work as hard as possible.”
The deal was supposed to offer Coca-Cola with a world platform in a rising space of the drinks market.
Costa trades in dozens of nations, together with India, Japan, Mexico and Poland, and operates a community of 1000’s of espresso merchandising machines internationally underneath the Costa Categorical model.
The chain was based in 1971 by Italian brothers Sergio and Bruno Costa.
It was bought to Whitbread for £19m in 1995, when it traded from fewer than 40 shops.
The enterprise is now one in every of Britain’s greatest non-public sector employers, and has turn into a ubiquitous presence on excessive streets throughout the nation.
Its fundamental rivals embody Starbucks, Caffe Nero and Pret a Manger – the final of which is being ready for a stake sale and doable public market flotation.
It has additionally confronted rising competitors from extra upmarket chains resembling Gail’s, the bakeries group, which has additionally been exploring a sale.
Apollo and KKR each declined to remark.
