Coffee Nation operates 900 vending machine sites across the UK, including locations at Tesco and Welcome Break.
Whitbred has acquired the brand to develop its new Costa Express brand.
In particular, it has set a target of having 3,000 self serve coffee bars across Britain over the next five years.
In short, the Coffee Nation coffee bars will be scrapped and rebadged as Costa Express.
Andy Harrison, Whitbread chief executive, said: "Customers increasingly want great tasting coffee on the go, which makes the self-service coffee market very attractive."This acquisition provides an exciting launch pad to develop 3,000 Costa Express bars across the UK, providing an additional growth lever for the Costa brand and making Costa available to more customers in more locations"
Costa Coffee is fighting for customers against other high street coffee brands and against Starbucks.
Separately, Whitbread updated the City on its financial performance.
Commenting on the performance of Costa Coffee, the group said like-for-like sale in the last 11 weeks to 17 February were up 3% on the year.
It said Costa remains on target to grow the business to at least 3,000 stores by the end of 2014/15.
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