Starbucks Coffee Company has closed the joint venture (JV) deal with private equity firm Boyu Capital, ceding control of its China operations.
In a statement, Starbucks said the deal, initially announced in November last year, marks a key step in the company’s long-term strategy to drive “sustainable, disciplined growth” in China.
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With the transaction now complete, funds managed by Boyu Capital now own 60% of Starbucks China’s retail operations.
Starbucks retains the remaining 40% shareholding and will continue to own and licence the Starbucks brand and intellectual property to the JV.
At the time of announcement, Starbucks said Boyu would acquire the stake at a cash-free, debt-free enterprise valuation of about $4bn.
Boyu Capital, established in 2011, works with more than 200 portfolio companies and has offices in Hong Kong, Beijing, Shanghai and Singapore.
Boyu Capital Partner Alex Wong said: “Starbucks has built an iconic brand and a deep connection with Chinese consumers.
“We are proud to support Starbucks next chapter of growth in China and look forward to working together to expand the brand’s presence and relevance over the long term.”
The new structure shifts about 8,000 Starbucks company-operated coffeehouses in China into a licenced operating model under the JV.
Starbucks and Boyu have set a joint long-term goal of potentially increasing the network to as many as 20,000 outlets across the country.
The partnership aims to support faster store expansion, sharpen local relevance and enhance customer experience, while preserving Starbucks’ brand standards and values.
The partners will now move into the operational phase of the JV, focusing on growth initiatives and product and service innovation in the Chinese market.
Starbucks Coffee Company chairman and CEO Brian Niccol said: “China remains one of the most exciting long-term opportunities for Starbucks, and finalising this partnership with Boyu accelerates our ability to grow with intention and discipline.
“By combining Starbucks trusted global brand with Boyu’s deep local expertise, we are positioning the business to serve more customers, enter more cities, and strengthen our leadership in a dynamic and evolving market.”
Starbucks, founded in 1971, now has more than 41,000 company-operated and licensed coffeehouses worldwide.
