The Seattle coffee giant Starbucks has finalized a major partnership agreement with Chinese investment firm Boyu Capital, transferring majority ownership of its China business operations, the company revealed on Thursday.
Originally outlined last November, this strategic partnership is designed to accelerate Starbucks’ expansion efforts in China, the world’s second-largest economy, where domestic competitors such as Luckin and Cotti have been capturing market share through competitive pricing strategies.
Under the completed agreement, investment funds managed by Boyu Capital will control a 60% ownership stake in Starbucks’ Chinese retail locations. Starbucks will maintain the remaining 40% while continuing to provide brand licensing and intellectual property rights to the joint venture. Notably, Boyu’s founding team includes a grandson of former Chinese President Jiang Zemin.
Molly Liu, who serves as chief executive officer of Starbucks China, explained in a company statement that this partnership will enable “hyper-localization” of the Starbucks brand throughout the Chinese market.
The coffee chain currently operates roughly 8,000 locations across China. Through this new partnership with Boyu, Starbucks has set an ambitious target to more than double that presence, aiming to reach 20,000 stores in the country.
