Propel Newsletter Archive Page

Coca-Cola scraps plans to sell Costa after bids fall short: Coca-Cola has ditched plans to sell Costa Coffee after bids from private equity suitors fell short of its expectations. Firms in the latter rounds of negotiations included Asda owner TDR Capital and Bain Capital’s special situations fund, owner of Gail’s and PizzaExpress, the FT reported. Coca-Cola had been seeking about £2bn for Costa, roughly half the £3.9bn it paid to acquire the UK’s largest coffee shop brand from Premier Inn owner Whitbread in 2018. Talks over a deal with TDR would have seen Coca-Cola retain a minority stake in Costa. Private equity firms Apollo, KKR and Centurium Capital, owner of China’s Luckin Coffee brand, were involved at earlier stages of the process, which was handled by Lazard, according to people familiar with the matter. The decision to end efforts to find a buyer for Costa, which has more than 2,700 branches across the UK and Ireland, comes as Coca-Cola chief operating officer Henrique Braun prepares to replace James Quincey as chief executive in March. One person familiar with Coca-Cola’s thinking said the company could still revive plans to sell Costa in the medium term. Quincey, who admitted to analysts last July that Costa had “not delivered” for Coca-Cola, will become the company’s executive chair. Under Coca-Cola’s ownership Costa has found itself competing with more upmarket independent coffee shops and cheaper operators such as Greggs, at a time of subdued consumer spending. Costa’s operating loss more than doubled to £13.5m on revenue of £1.2bn in 2024, according to its latest accounts. UK coffee shops have since been grappling with higher coffee bean prices and staffing costs, principally through the increase to employers’ national insurance which came into effect in April last year. The failure of the sale process may force Coca-Cola to write down the value of Costa on its books. In 2024, Costa took an impairment of £48.6m on the value of its Chinese business, attributing the move to weaker than expected demand in its coffee shops in Shanghai. Meanwhile Costa’s Express business, which owns and operates the brand’s self-service machines, wrote down the value of its assets by £51m last year after choosing to discontinue the use of “certain prototypes”. Coca-Cola, Bain and TDR all declined to comment.

Propel 500 report – loyalty programmes now the main focus for hotel companies: The large global hotel companies are focusing less on owning property and more on staking a claim for the guest, reports Katherine Doggrell, Propel’s editorial advisor. Doggrell was writing in Propel 500 – 2026, the sector-leading report covering the top 500 hospitality companies in the UK. She said loyalty programmes are now the main focus for hotel companies, with Marriott, the largest of them all, controlling one with almost 230 million people. Doggrell said: “Marriott’s recent $335m purchase of CitizenM, which has been experimenting with a subscription model, suggests the company is ready to work out a model where it becomes the Netflix of hotels. Proving that it was on to something, Wyndham has launched a subscription offering room discounts and access to higher-level loyalty tiers only a few months after the deal. As we head into a new year, the battleground for hotels will be ownership not of assets, but of the guest.” The 45,000-word report includes exclusive analysis to provide a full understanding of the market's dynamics, as the top companies in the sector shift position after a challenging year. Mark Wingett reviews the mergers and acquisitions changing the shape of the top 500 as size increasingly matters, while Tim Street dissects the UK’s rapidly developing franchise market. Mark Bentley, business development director at HDI, looks at emerging growth sectors, and Meaningful Vision founder Maria Vanifatova analyses the latest trends in the quick service restaurant market. Propel 500 – 2026 is now available free to Premium Club subscribers. The report will be available to non-Premium Club subscribers for £595 plus VAT. A Premium Club subscription costs an annual sum of £495 plus VAT for operators and £595 plus VAT for suppliers. Companies can now have an unlimited number of people receive access to Premium Club for a year for £995 plus VAT – whether they are an operator or supplier. Email kai.kirkman@propelinfo.com today to sign up.

Zero Carbon Forum – members have recovered £5m in lost profits and saved 825,000 tonnes of carbon dioxide emissions over last five years: The Zero Carbon Forum has announced its members have recovered £5m in lost profits through reducing energy wastage over the last five years. In its five-year review, the forum also said since 2020, its members have saved 825,000 tonnes of carbon dioxide emissions and seen a 52% reduction in direct energy emissions. Furthermore, they are on track to meet 2030 net zero targets for direct energy emissions. Looking ahead, the forum said the majority of emissions, and the hardest to reduce, are those in the sector’s supply chain. However, the forum has pioneered industry frameworks and strategically aligned with suppliers for key emissions areas – including beef, dairy and waste – ensuring that emission reductions will accelerate. Mark Chapman, founder of the Zero Carbon Forum, said: “Given the sector’s current economic pressures, we’re proud to launch the five-year review. It clearly proves that implementing our roadmap delivers credible climate action that protects the bottom line, builds resilience and grows brands that people love to work for, buy from and invest in. Through our collaboration, individual businesses are cutting more carbon and recovering more profits than going alone. With further support from the UK government to unlock barriers, such as grid capacity, we will accelerate our progress. This is a model that could be adopted in every industry and every country.” The forum has grown from 22 founding members to more than 70 brewing and hospitality leaders and is now focused on scaling this success. The forum aims to collaborate with the supply chain to cut the hardest emissions – building climate resilience, and enabling sustained, efficient growth for the sector.

Half of pubs shutting early after government tax raid: Almost half of Britain’s pubs have scaled back their opening hours over the past year after the government’s tax raid. Many landlords are closing early or scrapping lunchtime services to offset higher costs, as they seek to cope with soaring wages and inflated property taxes under Labour. According to a survey from the British Beer & Pub Association (BBPA), seen by The Telegraph, 47% of pub owners said they had reduced hours on trading days between April and October last year. A total of 84 owners responded to the survey, representing hundreds of pubs. This came after chancellor Rachel Reeves increased both employers’ national insurance rates and the minimum wage after coming to power, while also cutting business rates relief. One in seven pub owners who responded to the BBPA survey said they had been forced to close entirely on certain days of the week, while almost two thirds said they had made cuts to staff hours. The findings were part of a broader survey of the hospitality industry that surveyed the owners of 13,000 hospitality sites. BBPA chief executive Emma McClarkin said: “Publicans across the country are being forced to cut staff hours and shut up shop earlier simply because of the cost of keeping the doors open, which hurts workers, communities and high streets.” While the survey covers the seven months to October, pressure on pubs has only intensified since. Under business rates reforms announced by Reeves in her November Budget, pubs are facing additional annual costs of £150m over the next three years. This stems from the removal of covid relief measures and property revaluations. Reeves last week signalled that she is preparing a climbdown on the policy. She has yet to outline the changes that will be made to help pubs.

Edinburgh and London Stratford sites among TGI Fridays closures: The TGI Fridays sites in Edinburgh and London Stratford were amongst the 16 closed with immediate effect yesterday (Tuesday, 13 January) after the company that managed the UK operations of the casual dining brand was acquired out of administration. The business and assets of Liberty Bar and Restaurant Group were acquired by Sugarloaf TGIF Operations in a pre-pack transaction that saw the transfer and continuing operation of 33 restaurants across the UK. Ryan Grant and Will Wright were appointed joint administrators to Liberty Bar and Restaurant Group on 13 January 2026. Immediately thereafter, they sold the business and assets of the company to Sugarloaf TGIF Operations, a company owned by Sugarloaf, the manager and custodian of the worldwide TGI Friday brand. As well as the transfer of 33 TGI Friday restaurants, the transaction also safeguards the jobs of 1,384 employees who have transferred to Sugarloaf TGIF Operations. A total of 16 sites were not included as part of the transaction and as such, have closed with immediate effect, resulting in 456 redundancies. Those are based in Aberdeen Beach, Ashton, Bournemouth, Braintree, Coventry, Crawley, Doncaster, Edinburgh, Nottingham, Reading, Sheffield (Sheffield Road), Staines, Stevenage, Telford, Walsall, and London Stratford. The business was put up for sale in November, just a few weeks after Sugarloaf TGIF Management, a company run by the brand’s former chief executive, Ray Blanchette, bought it.

Hospitality Apprenticeship Showcase marks ten-year milestone: The Hospitality Apprenticeship Showcase celebrates its tenth anniversary next month, bringing the industry’s emerging talent to the heart of Westminster during National Apprenticeship Week. Taking place on Wednesday, 11 February at the Terrace Pavilion, House of Commons, the showcase has become a flagship annual event, welcoming around 120 hospitality apprentices each year and highlighting the breadth, quality and impact of apprenticeships across the sector. Over the past decade, the event has mirrored the transformation of apprenticeships, from being viewed as a second-rate option to becoming a highly regarded and aspirational pathway into skilled, long-term careers for people of all ages. Each year, the showcase has been recognised and supported by government ministers and constituency MPs, providing apprentices with a unique opportunity to connect directly with their local representatives. Apprentices attending represent the full diversity of hospitality roles and throughout the afternoon, will showcase their skills. Operators supporting the event include Nando’s, Stonegate Group, Fuller’s, Butcombe Group, Mitchells & Butlers, Wadworth, Star Pubs & Bars, Shepherd Neame and Brewhouse & Kitchen.