Transaction Overview and Equity Split
Starbucks is set to hand over control of its Chinese retail arm to Boyu Capital in a partnership valued at around $4 billion, marking a significant reshaping of its business in Asia. The agreement grants Boyu up to a 60% ownership stake in the newly formed joint venture, while Starbucks will hold the remaining 40%. Despite ceding operational control, the Seattle-based company will continue to license its brand and intellectual property to the venture. Both parties expect the deal to close in the second quarter of fiscal 2026, pending regulatory clearance from Chinese authorities.
Purpose and Strategic Context
The shift is part of Starbucks’ broader plan to revive its growth trajectory in China, where it has faced rising competition and changing consumer behavior. The company, operating roughly 8,000 cafés across the country, aims to leverage Boyu’s local experience and resources to expand into smaller cities and improve efficiency. Analysts view the collaboration as an attempt to regain momentum in a market increasingly dominated by homegrown coffee chains such as Luckin Coffee and Cotti Coffee.
Long-Term Expectations and Market Implications
According to Starbucks, the combined value of the transaction—including its retained equity, expected royalties, and sale proceeds—could exceed $13 billion over time. The move underscores the company’s transition toward a partnership model in key international markets, balancing growth potential with local expertise. Observers say the outcome of this venture will shape Starbucks’ future presence in China and influence how Western brands navigate ownership structures in one of the world’s most competitive consumer markets.
