Singapore’s GIC picks up stake in Starbucks’ Korean unit

Seattle-based coffee titan Starbucks has agreed to sell its 50% ownership stake in its South Korean joint venture to its partner Emart and Singapore’s GIC.

Korean retail major Emart will acquire a 17.5% stake in Starbucks Coffee Korea in addition to what it already owns, with the rest going to Singapore’s sovereign wealth fund. This will give Emart a 67.5% ownership of Starbucks operations in the country, according to a statement.

Photo credit: Pxhere

The joint venture was established in 1999, when Starbucks Korea opened its first store near Ewha Womans University in Seoul. The venture has grown to become Starbucks’ fifth-largest market in the world with more than 1,500 stores across 78 cities.

“Starbucks and Emart have had many conversations on how we can continue to grow the Starbucks brand in the market, which led to this decision,” said TJ Hyung, executive vice president of Emart.

The deal is expected to be completed over the next 90 days. Since Emart will remain the operator of Starbucks Coffee Korea, the business will continue uninterrupted with no impact on its partners or customers, Starbucks said.

The development comes after GIC announced plans to purchase a 9% stake worth up to US$225 million in Indonesian banking and financial services firm Bank Jago. The sovereign wealth fund has also recently invested in Indian logistics management company Locus and fintech firm Razorpay.