Starbucks China Business Attracts $10B Bids from Global Firms

Starbucks is considering offers for its China business valued up to $10 billion, with around 30 U.S. and international private equity firms submitting bids ranging from $5 billion to $10 billion. The company seeks a strategic partner that shares its vision and aims to retain a meaningful stake, potentially around 30%, while selling the remainder to various investors, some of whom could include Centurium Capital, Hillhouse Capital, and Carlyle Group. Despite increasing competition from Luckin Coffee, which has grown rapidly and surpassed Starbucks in China in unit count and revenue, Starbucks remains committed to the Chinese market, citing significant long-term growth potential. Starbucks China currently operates nearly 7,800 stores, making up about 20% of the chain's global footprint, with recent financials showing flat same-store sales but increased net revenue. Analysts offer mixed valuations, with some suggesting the $10 billion figure may be optimistic, estimating a more conservative range between $2.6 billion and $4.7 billion; however, investor interest appears strong, as reflected in Starbucks' stock performance and options market activity. Starbucks intends to use any proceeds from a potential stake sale to reduce debt and maintain its influence in shaping the brand's future in China.