The purchase from Britain's Whitbread of Costa's nearly 4,000 outlets thrusts the world's biggest soda company into one of the few bright spots in the sluggish packaged food and drinks sector.
It's Coca-Cola's latest move to diversify as health-conscious consumers, at least in America, move away from traditional soda.
Coca-Cola on Friday said it had agreed to buy global coffee chain Costa from its United Kingdom owner Whitbread for £3.9 billion ($5.1 billion).
Coca-Cola President and CEO, James Quincey, said in a press release: "Costa gives Coca-Cola new capabilities and expertise in coffee, and our system can create opportunities to grow the Costa brand worldwide". JAB Holdings, an investment holding company, has been buying up businesses and brands associated with Peet's, Caribou, Stumptown and Krispy Kreme Doughnuts.
Besides its thousands of retail stores, Costa Coffee also has smaller on-the-go outlets called Costa Express, a roastery and for-home coffee products.
The deal comes hot the heels of another big money acquisition in the sector.More news: California Streamin': State Gets Tough on Net Neutrality
Speaking on the BBC's Today programme, Ms Brittain explained that Coca-Cola wanted to buy Costa because "they want the coffee product, they have no coffee in their range". In 2017, it generated operating income of $9.7 billion on revenues of $35.4 billion.
Whitbread, which acquired Costa in 1995, said it will use proceeds from the sale of the coffee business to expand its other big brand, Premier Inn hotels.
Then Coca-Cola got in touch with what Whitbread said was a "highly compelling" offer.
Whitbread added that it intends to return a significant majority of net cash proceeds to shareholders. According to the press statement, the transaction is expected to close in the first half of 2019.
Meanwhile following pressure from activist shareholders, Whitbread announced in April that it would spin off Costa, leaving it to concentrate on its hotel chain Premier Inn.
Whitbread shares rose more than 17% in early Friday trading.
"Whitbread will also reduce debt and make a contribution to its pension fund, which will provide additional headroom for the expansion of Premier Inn".