(Yicai) April 24 -- Swiss food and beverage giant Nestlé has confirmed that it will sell Blue Bottle Coffee to the largest shareholder of Chinese coffee chain Luckin Coffee.

“Nestlé has agreed the sale of Blue Bottle Coffee to Centurium Capital,” the company said in its first-quarter sales report released yesterday, confirming market rumors that had been circulating online. “The transaction is subject to the customary conditions and is expected to close during the first half of 2026.”

36Kr reported last month that Centurium Capital had reached an agreement with Nestlé to buy Blue Bottle Coffee’s stores globally for about USD400 million, while Nestlé would retain the brand’s fast-moving consumer goods business, including coffee beans, instant coffee, and ready-to-drink beverages.

After the deal is completed, Luckin Coffee and Blue Bottle Coffee will operate independently as two separate brands, a person close to the deal told Yicai.

Blue Bottle Coffee was established in the United States in 2002. Nestlé bought a 68 percent stake in the specialty coffee brand for USD425 million in 2017. Afterward, Blue Bottle Coffee retained the right to operate independently. It had about 140 stores worldwide as of the end of last year.

Centurium Capital is an early investor in Luckin Coffee and took over the company’s ownership after it sank into a financial fraud scandal in 2020. Its founder Li Hui became the chairman of Luckin Coffee’s board of directors in April last year.

For Centurium Capital, the acquisition of Blue Bottle Coffee can complete its layout in the coffee sector, meet the upgrading demand from Luckin Coffee clients, and prevent high-end users from flowing to other specialty coffee brands, industry insiders told Yicai.

After shaking off the shadow of financial fraud, Luckin Coffee rapidly expanded in the Chinese market and surpassed Starbucks to become the largest coffee chain in the country.

Luckin Coffee reported revenue of CNY49.3 billion (USD7 billion) and a net profit of CNY3.6 billion (USD513.9 million) last year, up 43 percent and 22 percent, respectively, from the year before, according to the company’s latest annual earnings report. The total number of its stores jumped 39 percent to 31,048 as of Dec. 31 from a year earlier.

Editors: Dou Shicong, Futura Costaglione