E-Mart to Buy Bigger Stake in Starbucks
29 July, 2021
Korea's biggest supermarket chain E-Mart and Singapore's sovereign wealth fund want to buy a bigger stake in Starbucks' Korean branch.
Shinsegae Group, which owns E-Mart, said Tuesday that it will join hands with GIC to acquire a 50-percent stake in Starbucks Coffee Korea. E-Mart already owns half of it and will buy another 17.5 percent stake for W474.2 billion, while GIC will acquire 32.5 percent stake (US$1=W1,154).
The American coffee chain opened its first store in Korea 22 years ago. Now there are over 1,500 Starbucks outlets here that generated W1.93 trillion in sales last year.
Unlike in other countries, the outlets are not franchises but wholly owned by the company. That means Shinsegae will keep paying brand royalties to Starbucks Coffee International of around five percent of sales.
Shinsegae wants to maximize the synergy between Starbucks, E-Mart, online retailer SSG.com and the SSG Landers baseball team. In May, SSG Landers players sported a new uniform with a Starbucks logo.
Korea, where the brand enjoys much higher social prestige than elsewhere, ranks among the top five markets for Starbucks along with Canada, China, Japan and the U.S.
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