Nestlé weighs divestment of Blue Bottle Coffee chain

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Nestlé has engaged investment bank Morgan Stanley to examine strategic options for its Blue Bottle Coffee business, including a possible divestment, as reported by Reuters.

The review forms part of a wider restructuring initiative led by new CEO Philipp Navratil, who is seeking to simplify the group’s portfolio and scale back direct involvement in running bricks-and-mortar retail.

Nestlé acquired a controlling interest in Blue Bottle Coffee in 2017 in a deal that valued the speciality coffee chain at about $700m.

The brand, known for its drip coffee and minimalist cafés, was seen at the time as a premium addition to Nestlé’s global coffee platform.

A sale now would likely be at a lower valuation than that 2017 benchmark. Deliberations are ongoing and no final decision has been made.

The potential exit follows a similar path taken by rival Coca-Cola, which is exploring options for its British coffee chain Costa Coffee, including a possible sale.

In August 2025, Sky News reported that Coca-Cola is working with investment bank Lazard on this process.

The soft drinks giant has opened discussions with potential bidders, including private equity companies.

Nestlé and Morgan Stanley both declined to comment on the Blue Bottle review.

Blue Bottle currently runs around 100 outlets across the US and Asia. In addition to its café network, the brand sells packaged coffee and branded merchandise such as mugs.

Nestlé is considering scenarios under which it would dispose of the physical cafés but keep control of Blue Bottle’s intellectual property, allowing it to continue distributing branded products without operating the retail sites.

Blue Bottle was founded by James Freeman in 2002 in Oakland, California, initially as a small-scale roastery.

Its first dedicated café opened in San Francisco in 2005, and the chain has since expanded into several major cities in the US and overseas.

The brand sits alongside Nestlé’s larger coffee operations, which include global labels such as Nescafé and Nespresso.

The Blue Bottle review comes as Nestlé conducts a broader reassessment of parts of its portfolio.

In July 2025, the group launched a strategic review of several vitamin and supplement brands, including Nature's Bounty, Osteo Bi-Flex, Puritan's Pride and its US private-label supplements business.

The company has also set out plans to sell its water division, which includes the Perrier and S.Pellegrino brands.

"Nestlé weighs divestment of Blue Bottle Coffee chain" was originally created and published by Verdict Food Service, a GlobalData owned brand.

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