Nestlé Reportedly Exploring Sale of Blue Bottle Coffee

Swiss conglomerate Nestlé is exploring the potential sale of Blue Bottle Coffee, according to a Reuters report citing three unnamed sources.

Nestlé acquired Oakland, California-born Blue Bottle Coffee in 2017 in an approximately $700 million deal that shocked much of the specialty coffee world, continuing a trend toward big-money consolidation in craft-focused or “Third Wave” specialty coffee. 

Reuters reported that Nestlé is working with an investment bank to “review options, including a potential sale” of Blue Bottle, which currently has approximately 78 U.S. cafes, plus dozens more in six other countries.

In response to a Daily Coffee News inquiry, Nestlé declined to comment on this story. DCN has also reached out to Morgan Stanley for comment. 

The potential Blue Bottle divestment is part of a broader portfolio review under the watch of new Nestlé CEO Philipp Navratil, who was appointed in September following the dismissal of Laurent Freixe. 

It also comes as at least nine Blue Bottle Coffee locations in the U.S. have unionized. Some 120 Blue Bottle workers walked off the job over the Thanksgiving holiday shopping weekend, alleging unfair labor practices and a lack of progress in contract negotiations.

Blue Bottle represents something of a higher-end outlier in Nestlé’s global coffee portfolio, which is dominated by brands such as Nescafé, Nespresso and Starbucks Coffee At Home. Coffee conglomerate JDE Peet’s, which is being acquired by Keurig Dr Pepper, has taken a similar approach with its ownership of Stumptown Coffee Roasters and Intelligentsia Coffee, two brands that helped grow the “Third Wave” coffee movement alongside Blue Bottle.

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