“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,” Starbucks CEO Howard Schultz said in the release.
Starbucks paid $620 million for the company, according to Bloomberg.
Teavana has 300 stores around the world. Starbucks plans to aggressively expand that number, according to the release.
Owning a tea company is a win for Starbucks, which is actively trying expand in Asia. The beverage is much more popular than coffee in China and Japan.
"This helps them really drive a locally focused product, which so many other U.S. chains have trouble doing," said Brian Sozzi, chief equities analyst at NBG Productions. "Think, Teavana is a pricey brand that could be sold to Chinese tea lovers with money."
Starbucks plans to add WiFi and tables to stores in order to create a Starbucks-like experience, but with tea.
" This is quite the opportunistic purchase for Starbucks, as it’s nowhere near Teavana’s IPO price," Sozzi said. "This is 100% about Starbucks wanting ownership of every category of interest on both the high-end and low end, and then leveraging that on a global scale and within multiple verticals (retail stores, supermarkets, home brewing machines etc.)"
Starbucks also said that acquiring Teavana will help it with its plan to expand its Tazo brand, which Schultz has said he wants to make a major force worldwide, particularly in Asia.
But some fans of Teavana complained about the corporate takeover on Twitter.
"Starbucks acquiring Teavana? Not sure how I feel about that, but my first thought was ugh," one user tweeted.
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