SBUX Starbucks Corporation

By Imani Moise 

Starbucks Corp. said Thursday that it will become the full owner of its East China joint venture in a bid to expand its presence in Asia.

The coffee chain will pay roughly $1.3 billion in cash to buy the 50% stake in the joint venture that it doesn't already own from Taiwan's Uni-President Enterprises Corp. and President Chain Store Corp. At that price, the deal is the largest acquisition in the company's history.

When the deal is closed, Starbucks will operate 1,300 stores in Shanghai as well as Jiangsu and Zhejiang provinces in China. The company has previously said it plans to operate 5,000 stores in China, its fastest-growing international market, by 2021.

"Unifying the Starbucks business under a full company-operated structure in China reinforces our commitment to the market and is a firm demonstration of our confidence in the current local leadership team," said Starbucks chief executive Kevin Johnson.

Starbucks has been looking outside the U.S. for growth after slowing sales at home hammered its stock last year. Mr. Johnson said in an interview earlier this year that China will likely overtake the U.S. as the company's largest market in the next 10 or 15 years.

At the end of last year, Starbucks had 1,811 company-operated and licensed stores in China.

Taiwan-based Uni-President Enterprises and President Chain Store will also buy Starbucks's 50% stake in President Starbucks Coffee Taiwan Ltd, which operates 410 coffee shops in Taiwan, for $175 million.

Starbucks shares edged up 0.1% to $58.00 premarket and have risen 4.4% so far this year.

Write to Imani Moise at imani.moise@wsj.com

(END) Dow Jones Newswires

July 27, 2017 08:43 ET (12:43 GMT)

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