Starbucks To Buy Out Japan Unit for $900 Million
Starbucks will buy 60.5 percent stake of its Japanese operations for $900 million by mid 2015 in a two step process.
Japan is Starbuck's second largest market and the company wants to tap that source, according to a statement Tuesday, by the company. The announcement sent the shares of Starbucks Coffee Japan up 4.50 percent to 1,462 yen ($13) on the Jasdaq start-up market Wednesday morning, reports Agence France Press.
"The acquisition positions Starbucks to accelerate growth across multiple channels in Japan, including the potential introduction of new concepts," the company said in the statement.
Starbucks was operating in Japan as a joint venture with Sazaby League, a Tokyo firm with a vast inventory of service and goods operations, since it entered the market in 1996. It already has 1000 plus stores across the country and employs around 2,500 people.
The two step tender process will start on Sept. 26th with the initial offering of 39.5 percent of Sazaby shares at about $505 million. The company will own a controlling 79 percent stake in Starbucks Japan after buying the shares. The remaining 21 percent will be bought at $408 million by the first half of 2015, reports USA Today.
Market reports say that Starbucks might also be planning to tap this major market of Japan for a possible launch of its Teavana Tea Chain. The coffee company might also add more shops and expand into grocery and food service channels. It also plans to corner a share of canned coffee and other ready-to-drink products that are popular in Japan, said Satrbucks officials, reports Reuters.
