Starbucks Brews New Venture in China with Boyu Capital

Starbucks is partnering with Chinese firm Boyu Capital in a joint venture for its Chinese operations. Boyu acquires a 60% stake for USD 4 billion, while Starbucks retains 40%. Despite 8,000 locations, Starbucks faces competition from local startups, prompting this strategic move.

Starbucks is set to invigorate its business in China by forming a joint venture with the Chinese investment firm, Boyu Capital. This strategic move comes as the Seattle coffee giant aims to strengthen its position in its second-largest market worldwide.

Under this agreement, Boyu Capital is investing USD 4 billion to acquire a 60% interest in Starbucks' retail operations in China. The American coffee chain will maintain a 40% stake, continuing to own and license the Starbucks brand as part of this collaboration.

Despite having 8,000 stores in China, Starbucks has faced increasing competition from rapidly growing local enterprises like Luckin Coffee. The joint venture is expected to bolster Starbucks' presence, particularly in smaller Chinese cities, enhancing their ability to compete in this dynamic market.

(With inputs from agencies.)