Ruixing's major shareholder Dazhi Capital is bidding to acquire Starbucks' China equity.

According to reports, the sale of Starbucks China business equity has attracted nearly 30 domestic and foreign private equity companies to bid, with a valuation of up to $10 billion and insiders estimating a reasonable valuation of around $9 billion. Starbucks plans to retain 30% of the equity, while the rest will be held by multiple buyers, each holding less than 30% to maintain strategic control. The company has made it clear that it has no intention to completely withdraw from the Chinese market. Bidders include Hillhouse Capital, Carlyle Group, KKR, and Dazheng Capital, the largest shareholder of Luckin Coffee led by Chairman Li Hui, who has recently strengthened control over Luckin and may be looking to reshape the coffee market in China through mergers and acquisitions. Starbucks China had a revenue of $740 million in the first quarter, a 5% year-on-year increase, with 7,758 stores and stable same-store sales. Luckin, on the other hand, has been growing rapidly with a revenue of 8.87 billion yuan in the first quarter, a 41.2% year-on-year increase, and over 24,000 stores. Starting from June, Starbucks has reduced prices by an average of $5 per cup to compete. Analysts believe that if Dazheng Capital successfully acquires Starbucks, it may drive the synergistic development of Starbucks and Luckin Coffee and optimize the market competition landscape. Starbucks is evaluating the proposal, with the deal expected to be finalized within the year, and investors should pay attention to the latest developments at the July 28th earnings conference.