SEATTLE—Nestlé will acquire the Seattle's Best Coffee brand from Starbucks to bolster its North American coffee business. Nestlé says the transaction is part of the company’s focus on driving sustained profitable growth in the coffee category.

In 2018, Starbucks and Nestlé formed the Global Coffee Alliance to accelerate and grow the global reach of the Starbucks brands in consumer packaged goods and foodservice. Starbucks and Nestlé said this transaction will further strengthen the Global Coffee Alliance by allowing both companies to focus on their core strengths.

"Our partnership with Starbucks has confirmed Nestlé's leading position in the dynamic and growing global coffee market," said David Rennie, head of Nestlé coffee brands, in a statement. "With the well-known Seattle's Best Coffee brand, we will continue to build our leadership in coffee by offering consumers more choice for their everyday coffee."

The Seattle's Best Coffee's brand includes whole bean, roast and ground packaged coffee and K-Cup pods in a variety of roasts and flavor profiles across both foodservice and grocery channels. In addition to Starbucks packaged coffees distributed by Nestlé under the Global Coffee Alliance, Seattle's Best Coffee joins Nestlé's roster of coffee brands in the U.S. including Nescafé, Nespresso and Blue Bottle.

Nestlé's says the addition adds depth to Nestlé's North America coffee portfolio by further expanding the company's position in the category.

Today, Nestlé distributes Starbucks consumer products and foodservice beverages across more than 80 markets outside Starbucks retail stores under the Global Coffee Alliance. The total global sales of Starbucks products distributed by Nestlé in 2021 reached CHF 3.1 billion.

“We continue to deepen our partnership with Nestlé to deliver the best of the Starbucks Experience to our customers in channels outside of our retail stores," said Michael Conway, group president, Starbucks International and channel development. "We're confident that Nestlé will continue to grow the Seattle's Best Coffee brand as we focus on our strategy to elevate the premium coffee experience for consumers through the Starbucks brand."

The deal is expected to close by the end of 2022 after the respective board and customary regulatory approvals.