Starbucks Corp recently signed an agreement to buy Teavana Holdings Inc (TEA) for about USD 620 million. Teavana, the company’s biggest acquisition, is another building block in CEO Howard Schultz’s plan to take Starbucks well beyond its coffee roots and namesake shops. Since returning as CEO in 2008, Schultz has revived the company and is making moves to sustain revenue growth with instant coffee, energy drinks,
juice, a single-serve brewer and food to sell in its shops and in grocery stores.
Starbucks, which dropped the word “coffee” from its logo last year, already owns the Tazo tea brand and last year bought Evolution Fresh Inc for USD 30 million and Bay Bread LLC this year for USD 100 million. The company is also expanding its retail presence in the US beyond Starbucks cafes with a Tazo shop and a new, smaller design for its Seattle’s Best Coffee locations, which it plans to take nationwide.
Teavana investors will receive USD 15.50 a share in cash, Seattle-based Starbucks and Atlanta-based Teavana said in a statement. The takeover is expected to close by the end of the year and will add about one cent to earnings per share in Starbucks’s fiscal 2013, according to a report by Leslie Patton in bloomberg.com.