Starbucks to form joint venture with Boyu Capital to run China business

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Starbucks

on Monday announced it is forming a joint venture with Boyu Capital to operate the company’s locations in China.

Under the terms of the deal, Boyu, an alternative asset management firm, will pay Starbucks roughly $4 billion to hold up to a 60% interest in the joint venture. Starbucks will hold a 40% stake and maintain its ability to license the brand and intellectual property to the joint venture.

The announcement comes after the coffee giant conducted a months-long review of options that included strategic partnerships. Starbucks values its China business at more than $13 billion, the company said. The valuation includes the sale of the controlling stake in the joint venture, combined with the value of both its retained interest and the ongoing licensing fees that will paid to the company in the future.