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Starbucks on Monday announced a $4 billion joint venture with Chinese investment firm Boyu Capital to run its retail operations in China — a major strategic shift for the coffee giant in its second-largest market.
Under the agreement, Boyu will take a 60 per cent stake, while Starbucks will retain 40 per cent ownership and continue to license its brand and intellectual property to the new entity. The company said the deal values its China business at over $13 billion, factoring in the sale of the controlling stake, its retained share, and future royalty income.
The decision comes after months of internal review, as Starbucks sought a local partner to bolster its presence in China, where competition has surged from homegrown rivals like Luckin Coffee, which now has more stores than Starbucks.
Starbucks, which entered China in 1999, currently operates about 8,000 outlets across the country. While China remains its largest market outside the US, the company has faced sales challenges in recent years due to pandemic disruptions and aggressive expansion by local competitors.
Starbucks Chairman and CEO Brian Niccol said the partnership with Boyu will be key to achieving its long-term expansion goals.
“Boyu’s deep local knowledge and expertise will help accelerate our growth in China, especially as we expand into smaller cities and new regions,” Niccol said.
Boyu Capital Partner Alex Wong said the collaboration builds on Starbucks’ strong relationship with Chinese consumers.
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More Shorts“This partnership reflects our shared belief in the enduring strength of the Starbucks brand and the opportunity to bring even greater innovation and local relevance to customers across China,” Wong said.
Molly Liu, CEO of Starbucks China, said the deal would help unlock new growth potential.
“Building on our positive business momentum, our partnership with Boyu will enable Starbucks China to fully unlock the vast market opportunity,” Liu said.
Starbucks’ China headquarters will remain in Shanghai, and the deal is expected to close in the second quarter of its 2026 fiscal year, pending regulatory approvals. Starbucks’ 2026 fiscal year began on September 29.
Boyu Capital, founded in 2011, has offices in Shanghai, Hong Kong, Singapore, and Beijing. Starbucks shares were flat in after-hours trading following the announcement.
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