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Decade of Deals: How Coffee Became the Must-Have Business

JAB has led the way in a rush of deals as consumers embrace better coffee

A barista places a coffee on to a serving tray in a Costa Coffee shop.
Photographer: Chris Ratcliffe/Bloomberg

Coffee’s the hottest thing in deals right now.

Coca-Cola Co.'s $5.1 billion agreement to buy U.K. coffee-shop leader Costa adds to a string of deals large and small for coffee-related businesses over the past decade. JAB Holding Co., the investment firm that manages the fortune of Austria’s Reimann family, has led the way, snapping up everything from the Keurig coffee-pods business to trendy chains like Caribou.

A couple of themes are driving the transactions: Consumers increasingly are embracing stronger, artisanal brews and specialty drinks rather than watery, industrial java, and beverage companies are looking for healthier alternatives as soft drinks fall out of favor.