Carlyle Group and Boyu Capital are the frontrunners to acquire a majority stake in Starbucks’ China business, as the US coffee chain seeks a local partner to navigate an increasingly competitive market, according to a report by the Financial Times.
The report cites sources familiar with the process as saying that both groups are seen as Starbucks’ preferred partners. Valuations for the full China operation are expected to come in at around $4bn, excluding royalties, which are still being negotiated. Starbucks has received five binding offers in total and is expected to make a decision by the end of the month, though the timeline is not final.
The deal could ultimately involve a consortium structure, with Starbucks potentially retaining up to 49% of its Chinese operations. Other private equity firms in the running include HongShan Capital (Neil Shen), Primavera Capital, and FountainVest.
Starbucks’ China business has faced growing pressure from local rivals such as Luckin Coffee, forcing the company to cut prices on select drinks earlier this year. However, the unit has recently shown signs of stabilisation, reporting three consecutive quarters of revenue growth as of mid-2025.
According to the FT’s sources Carlyle’s experience in the 2017 majority buyout of McDonald’s China could strengthen its bid, while local private equity groups like Boyu may benefit from better relationships with Chinese partners and supply-chain expertise. Starbucks CEO Brian Niccol has emphasised that the transaction is about operational partnership, not capital, highlighting the strategic role the new owner will play in expanding the brand across China.
If completed, the transaction — including Starbucks’ retained stake and royalties — could top $10bn.
