Starbucks, the global coffee chain, is set to make significant inroads into the global tea market by acquiring US-based speciality tea store operator Teavana for c$620m (£391).
Starbucks said it planned to “grow and extend” Teavana’s 300 mall-based stores “as well as add a high-profile neighbourhood store concept that will accelerate Teavana’s domestic and global footprint”.
The company said: “Just as Starbucks pioneered a new retail experience for coffee and espresso, the company’s acquisition of Teavana provides the opportunity to do the same within the rapidly growing $40bn global tea category.
“In calendar 2013, Starbucks will integrate its unique assets – including its leading position in social and digital media, its ten million member global loyalty program, card and mobile payment platforms – with the Teavana customer experience to expand Teavana’s current mall-based store footprint with a comprehensive design strategy that will include new Teavana neighbourhood locations in markets across North America and around the world.
“Teavana recently opened its first store in the Middle East in partnership with Starbucks existing joint venture partner Alshaya, and has plans to enter new, high-consumption tea markets around the world in the years ahead.”
Howard Schultz, Starbucks chairman, president and chief executive, said: “We believe the tea category is ripe for reinvention and rapid growth. The Teavana acquisition now positions us to disrupt and lead, just as we did with espresso starting three decades ago.
“Teavana’s world-class tea authority, coupled with the romance and theatre of the retail experience that is the heart and soul of Starbucks heritage, will create a differentiated customer experience and business opportunity that delivers immediate value to shareholders. This complements our existing Tazo brand and gives us the unique opportunity to create a two-tiered market position.”
Andrew Mack, chief executive and co-founder of Teavana has committed to staying and leading Teavana’s day-to-day operations. He said: “By contributing deep tea expertise, global sourcing capabilities and a passion for the category that is second to none in our industry, we believe we can deliver an elevated tea experience together with Starbucks.
“After growing Teavana for 15 years, we are thrilled that Starbucks will be able to truly fulfil our mission of bringing premium tea to millions of people on a global platform. It is with great respect for what Howard and his team have built that we join the Starbucks family.”
The agreement is subject to regulatory clearance
