US speciality coffee roaster and retailer Starbucks Corporation (NASDAQ:SBUX) said it had agreed to acquire speciality tea retailer Teavana Holdings Inc (NYSE:TEA) for USD620m (EUR486.6m) in cash, or USD15.50 per share.
The acquisition matches Starbucks’ growth strategy to introduce new products, enter new categories and use new channels of distribution. It is also in line with its commitment to continue to grow its existing Tazo tea business. The deal is seen to enhance its earnings by USD0.01 per share in fiscal 2013.
Teavana has 300 mall-based stores that sell more than 100 varieties of loose-leaf teas, authentic artisanal teawares and other tea-related merchandise. It recently opened its first store in the Middle East in partnership with Starbucks’ existing joint venture partner MH Alshaya Co LLC. The buyer said it plans to expand the tea retailer’s footprint by adding new neighborhood locations in markets across North America and around the world.
Stockholders of Teavana owning some 70% of the company’s common stock have already backed the deal, which is expected to close by the end of 2012, subject to regulatory approvals. Upon completion, Teavana will become a wholly-owned subsidiary of Starbucks.