Starbucks Coffee Co. will acquire Teavana Holdings Inc. for $620 million in cash.
At its 300 mall-based tea shops, Teavana offers more than 100 varieties of premium loose-leaf teas, authentic artisanal teawares and other tea-related merchandise. Founded in 1997, the specialty retailer is known for its passionate and knowledgeable staff, known as "teaologists", that engage and educate customers about tea.
The deal is expected to close by the end of the year. Starbucks plans to continue to grow and extend Teavana’s 300 mall-based stores as well as add a high-profile neighborhood store concept that will accelerate Teavana’s domestic and global footprint.
“We believe the tea category is ripe for reinvention and rapid growth,” said Howard Schultz, Starbucks chairman, president and ceo. “The Teavana acquisition now positions us to disrupt and lead, just as we did with espresso starting three decades ago.”
Andrew Mack, ceo and co-founder of Teavana, has committed to staying and leading Teavana’s day-to-day operations.
In calendar 2013, Starbucks will integrate its social and digital media, its 10 million member global loyalty program, card and mobile payment platforms – with the Teavana’s. The specialty tea retailer recently opened its first store in the Middle East in partnership with Starbucks existing joint venture partner Alshaya.
The Seattle-based coffee company said it also plans to grow its Tazo tea business.