Starbucks has contacted private equity firms, technology companies and others as it considers options for its China business, including a possible stake sale, according to people familiar with the matter.
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The coffee chain sent out letters via a financial adviser to several potential investors this week to solicit views on the China business and how to grow it, the people said, asking not to be identified because the process is private. A transaction could value the assets at several billion dollars, the people said.
Bloomberg News reported previously that Starbucks was assessing its operations in China, its second-biggest market. The company has warned of macroeconomic and competitive pressures in the country, where the likes of Luckin Coffee and Cotti Coffee have emerged as major home-grown players.
Starbucks, which had more than 7,750 stores in China as of the end of March, generated about US$740 million net revenue in the country in the quarter through March. Luckin’s net revenue was US$1.2 billion in the same period.
Prospective bidders are expected to submit initial feedback in the next few weeks, the people said. Starbucks may also decide not to do a deal, they said.
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