A staff member works at the Starbucks Reserve Roastery in east China's Shanghai, Nov. 24, 2023. (Xinhua/Wang Xiang)
SHANGHAI, Nov. 4 (Xinhua) -- U.S. coffee giant Starbucks Coffee Company announced on Tuesday that it has entered into an agreement to form a joint venture with Boyu Capital, a leading alternative investment firm, to operate Starbucks retail in China.
Under the agreement, Boyu and Starbucks will operate a joint venture with Boyu holding up to a 60-percent interest in Starbucks' retail operations in China, while Starbucks will retain the remaining 40-percent interest in the joint venture, and continue to own the Starbucks brand and license the brand and intellectual property to the new entity.
Boyu will acquire its interest based on a cash-free, debt-free enterprise value of approximately 4 billion U.S. dollars.
"Boyu's deep local knowledge and expertise will help accelerate our growth in China -- especially as we expand into smaller cities and new regions," said Brian Niccol, chairman and chief executive officer, Starbucks Coffee Company.
The business will continue to be headquartered in Shanghai in east China and will own and operate the 8,000 Starbucks coffeehouses across the market in the Chinese mainland -- with a shared vision to grow to as many as 20,000 locations over time.
With the new joint venture, Starbucks expects the total value of its China retail business to exceed 13 billion U.S. dollars.
"Starbucks has built an iconic brand and a deep connection with Chinese consumers over the past 26 years. This partnership reflects our shared belief in the enduring strength of that brand and the opportunity to bring even greater innovation and local relevance to customers across China," said Alex Wong, partner at Boyu Capital.
Starbucks opened a store in Beijing in 1999 -- marking its official entry into the Chinese mainland market. Boyu, founded in 2011, is an alternative asset management company that has been deeply rooted in the Chinese market and which has a global presence.
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