Gate One helps Whitbread to deliver £3.9bn deal in 4 months and create a standalone Costa business for Coca-Cola to acquire
On 31st August 2018, Whitbread announced that they had agreed to sell their Costa Coffee business to Coca-Cola in a landmark £3.9bn deal. This required Costa to be created as a fully standalone business in a timescale that was both tight and uncertain given external dependence on regulatory approvals.
The Costa separation required definition and implementation of standalone Costa functions, including people, processes and system changes across Finance, HR, IT, Procurement, Supply Chain and Legal functions. It also required the separation of a supplier base of over 200 firms, separation of estates, and agreement of commercial terms for ongoing transitional services to be provided by Whitbread to Costa. This was the first major separation in a post-GPDR world, meaning that all the deal consequences for data needed to be worked out and implemented without precedent to follow.
Given the separation of functional teams and major role changes across numerous areas, the deal created a period of significant uncertainty amongst Whitbread staff. This sensitive situation risked being exacerbated if the change was seen to be driven by heavy-handed external consultants.
Gate One and Whitbread agreed that it was important for the change to feel owned by Whitbread. We therefore worked together in true partnership to design an approach that combined the best of Whitbread’s capabilities with Gate One’s transformation expertise in a collaborative ‘one-team’ delivery.
The newly formed Whitbread and Gate One team set up and ran the governance required to drive rapid decision making and communication. We also created and executed a rapid planning framework to scope and plan the work in 2-3 weeks. We implemented a tailored programme management approach, ensuring all deadlines and required decisions were tracked and driven, and all risks and issues effectively mitigated.
Costa was successfully separated into a standalone business in just 4 months, despite an accelerated timeframe due to earlier than expected regulatory approvals. The outcome was a fully functioning Costa business, resulting in successful completion of the £3.9bn deal.
The separation was perceived to have been delivered with as minimal stress as possible placed on the business. When asked to provide a Net Promoter Score, which is an indication of how likely a person is to recommend an organisation, Whitbread rated Gate One as 10 out of 10.
The project has also been recognised externally, winning the ‘Deal of the Year’ award at The Retailers’ Retailer Awards 2019 and ‘Transformation of the Year Award’ at the PLC Awards 2018.
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