Starbucks buying out Japanese partner for $913 million

Seattle -- Starbucks Corp. will acquire the remaining shares of its Japanese joint venture, Starbucks Coffee Japan, for $913 million to accelerate growth across multiple channels in the country, including the introduction of new concepts such as Teavana. The acquisition is the largest to date made by Starbucks. Japan is the company’s second-largest market in store sales after the United States.



“Full ownership in this market is the right approach for the future," said Troy Alstead, COO, Starbucks, in a conference call with analysts.



Starbucks is buying the shares from its Japanese partner, Sazaby League, in a two-step process beginning Sept. 26. The deal is expected to be complete in the first half of 2015. The acquisition comes as Starbucks is pushing into more and more international markets.



“Japan is a market we know well and care deeply about, with more than 25,000 partners serving millions of customers every week at more than 1,000 stores,” said Howard Schultz, chairman, president and CEO of Starbucks. “Full ownership of Starbucks Japan enables us to build on the amazing foundation of customer trust and loyalty our partners have achieved by continuing to take care of our people, delivering the highest quality coffee and innovating in product, store design and the digital experience."



Sazaby approached Starbucks in the summer about selling its Starbucks Japan ownership stake to the U.S. coffee giant and exiting the business in a smooth and orderly manner in advance of the expiration of Starbucks Japan’s retail franchise rights.



“It has been an honor for Sazaby to be part of the Starbucks family for nearly two decades,” said Masatoku Mori, president and representative director, Sazaby. “We are deeply grateful for the opportunity we have had to introduce the Starbucks Experience and the world’s best coffee to Japan. We have full confidence that Starbucks will continue to care for our dedicated partners, loyal customers and neighboring communities with the same personalized attention and respect they’ve provided since opening our first Starbucks store in 1996.”

In other global Starbucks news, the India Press reports Starbucks will expand its presence there into smaller towns and suburbs, with stores that are less than half the size of traditional Starbucks stores.