Starbucks forms joint venture with Boyu Capital to run China business

Core Insights - Starbucks is forming a joint venture with Boyu Capital to operate its locations in China, with Boyu paying approximately $4 billion for a 60% stake [1][2] - Starbucks values its China business at over $13 billion, which includes the sale of the controlling stake and future licensing fees [2] - Starbucks has over 8,000 locations in China, making it the company's second-largest market after the United States [3] Business Performance - Starbucks has experienced a decline in sales in China due to the pandemic, government restrictions, and increased competition from rivals like Luckin Coffee [4][5] - The company’s weak performance in China has negatively impacted its overall financial results [5] - The economic slowdown in China and competition from local brands have prompted U.S. companies to reconsider their strategies in the market [5] Industry Context - Other companies in the food and beverage sector are also adjusting their strategies in China, with Burger King's parent company divesting its struggling business while McDonald's increased its stake in its China operations [6]