Nicolas Parasie
Mon, November 1, 2021
(Bloomberg) -- Kuwaiti conglomerate Alshaya Group is considering selling a minority stake in its Starbucks Corp. franchise that extends from the Gulf region to Russia, according to people familiar with the matter.
Family-run Alshaya is working with JPMorgan Chase & Co. on a potential transaction, the people said, asking not to be named because the information is private. No final decision has been made and the owners could still decide against pursuing any deal, they said.
A spokesperson for the Kuwait-headquartered company declined to comment on any specifics but said “we constantly look at potential strategic initiatives across the business, in line with Alshaya’s continued strong performance.” JPMorgan declined to comment.
Raising cash through a private placement would help Alshaya move past a period of unprecedented disruption that saw the retail and food industry suffer from lockdowns during the global pandemic. While the sector has rebounded this year thanks in part to a shift to e-commerce and growing delivery sales, economic concerns remain a drag on consumer spending.
Established in 1890 and believed to be Kuwait’s oldest company, Alshaya is one of the Middle East’s largest operators of popular retail brands such as Victoria’s Secret and the Cheesecake Factory.
The Seattle-based coffee chain is Alshaya’s biggest franchise with around 1,700 outlets, a large number of which are in Turkey.
Alshaya opened its first Starbucks in Kuwait in 1999 and later expanded the brand to Turkey in 2003 and Russia in 2007. It now offers Starbucks in 14 markets and expects to be operating 1,750 stores by end-2021.
The group runs over 4,000 stores across the region from Dubai with its cavernous malls to Turkey and Russia, boasting a total of nearly 70 brands. Its digital footprint also includes more than 100 websites and apps.
The company employs more than 50,000 people and counts H&M, P.F. Chang’s and The Body Shop in its regional portfolio, according to its website.
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