It will give Coca-Cola "a strong coffee platform across parts of Europe, Asia Pacific, the Middle East and Africa, with the opportunity for additional expansion", Coca-Cola said in a statement.
The purchase of the biggest coffee chain behind Starbucks adds to Coca-Cola's drive to diversify away from fizzy drinks and expand its options for increasingly health-conscious consumers, after countries started introducing sugar taxes.
Britain's Whitbread Plc said on Friday it had agreed to sell coffee chain Costa to Coca Cola for an enterprise value of 3.9 billion pounds ($5.1 billion).
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. "Costa gives us access to this market through a strong coffee platform", Coca-Cola chief executive James Quincey said in a joint statement. JAB Holdings, an investment holding company, has been buying up businesses and brands associated with Peet's, Caribou, Stumptown and Krispy Kreme Doughnuts.
Nicholas Hyett, an equity analyst at London-based stockbrokers Hargreaves Lansdown, said Costa will get "lots of care and attention" from Coca-Cola.
The deal comes hot the heels of another big money acquisition in the sector.
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Coca-Cola, which has over 500 brands in its stable including Fanta, innocent smoothies and Powerade sports drinks, certainly has the deep pockets to help push Costa on the world stage.
Premier Inn has 785 hotels in the United Kingdom and a sprinkling of others in Germany and the Middle East.
Whitbread acquired Costa in 1995 from its founders, Sergio and Bruno Costa, and presently runs about 2,400 stores in the United Kingdom and some 1,400 around the world.
Whitbread will use a "significant majority" of the net cash proceeds around 3.8 billion pounds after taking into account such things as transaction costs returning cash to shareholders.
The deal, expected to complete in the first half of 2019, plugs a big hole in Coca-Cola's portfolio.
Shareholders in Whitbread were impressed by the deal and the company's share price soared 16 percent in morning trading in London.
Asked if Whitbread had been pressured to accelerate the sale by activist investor Elliott and other hedge funds, Chief Executive Alison Britain said no.