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>> Coca Cola is taking on the world of coffee by buying the second largest coffee chain, Britan's Costa, for $5.1 billion. It's a drive to diversify away from fizzy drinks as countries introduce sugar taxes. Instead, they're embracing increasingly health conscious consumers. And as Reuters' Kate Holton explains, the booming global coffee market is an attractive target.
>> The packaged food and drinks market has been quite difficult for quite a long time. There's a lot of deflation in that market. But the coffee market in the middle of that is doing incredibly well. If you think particularly of millennials or people of all ages, they are willing to spend two, three pounds in the UK.
What's interesting with the Coke deal is, what they're actually looking at is more perhaps about the vending machines and the distribution that they already have. So Coke already supplies all their drinks to cafes, restaurants, bars. Or they could bottle coffee into their vending machines.>> The purchase from British firm Whitbread includes almost 4,000 outlets.
And means Coca-Cola will be taking on some new rivals, Nestle and coffee chain market leader Starbucks, which has almost 29,000 stores. But Coca-Cola faces another, perhaps greater challenge, millennials with exotic taste in coffee who think chain store brews are just a bit uncool.