THE's $2.3B surge propels 18th spot as Coca-Cola weighs Costa divestiture

On September 3, 2025, The (THE) recorded a trading volume of $2.3 billion, a 34.94% increase from the previous day, ranking 18th in market activity. Coca-Cola (KO) closed down 0.10%, reflecting market sensitivity to its strategic review of the Costa Coffee acquisition.

Coca-Cola is evaluating the potential sale of Costa Coffee, its UK-based coffee chain acquired in 2018 for £3.9 billion. The company has enlisted Lazard to assess options, with discussions reportedly underway with private equity firms such as TDR Capital and Apollo Global Management. Analysts suggest a possible sale price of around £2 billion, significantly below the original investment. Coca-Cola CEO James Quincey acknowledged that Costa has underperformed expectations, failing to accelerate growth in ready-to-drink coffee and home brewing solutions despite store-level improvements.

Industry experts argue that Costa’s retail-heavy model conflicts with Coca-Cola’s asset-light beverage strategy. The coffee chain reported £1.22 billion in 2023 revenue, below pre-acquisition levels, while facing inflationary pressures and operational challenges. Some recommend Coca-Cola retain a minority stake in Costa’s RTD formats to maintain a coffee presence without the operational burden. Potential buyers, including TDR Capital and Apollo, are seen as better positioned to optimize Costa’s retail estate and address structural challenges like labor costs and shifting consumer habits.

Coca-Cola’s strategic pivot reflects a broader focus on high-growth categories such as hydration, energy drinks, and alcohol alternatives. While no final decision has been made, the review underscores the company’s commitment to portfolio discipline, reallocating capital to businesses aligned with its core strengths in distribution and brand-building.