Starbucks announced Tuesday that it will purchase the remaining 60.5 percent stake of Starbucks Coffee Japan Ltd that it doesn’t own for approximately $913.5 million, according to Reuters.
Starbucks Japan has been operated by the parent company and partner Sazaby League since 1995, however, Sazaby approached Starbucks this past summer about the possibility of a sale.
The 1,050 or so Starbucks cafes in Japan amount to the company’s second-largest market in regards to coffeeshop revenue. The article notes that the country offers Starbucks greater opportunities with more shops and increases in its canned coffee business and presence in grocery and foodservice channels.
Starbucks will finalize the move with a two-step process: first, acquire Sazaby’s 39.5 percent stake, and second, buy remaining ownership from public shareholders and option holders.
“Despite Japan’s economic difficulties, those shops have profit margins that are among the highest in the world, Starbucks executives said on a conference call with analysts,” Reuters writes.
In response to the company’s intentions, Wells Fargo senior analyst Bonnie Herzog wrote that the transaction could lead to greater growth and innovation in the country while encouraging execution abilities and financial discipline.
“We believe this is a wise strategic move for [Starbucks] as it should enable [Starbucks] to accelerate growth and momentum in this important and profitable market, which should become [Starbucks’] second largest revenue contributor and fourth largest market by store count,” Herzog wrote.
ABA Fights Soda Tax With Wallet
With November not too far in the distance, the American Beverage Association (ABA) is doubling down on its opposition to a proposed soda tax in Berkeley, Calif.
The Daily Californian writes that a political action committee with the ABA has contributed $500,000 to fight the legislation known as “Measure D” that, if passed, would result in a 1-cent-per-ounce tax on distributors of sugar-sweetened beverages in the region.
The article notes that members of the Berkeley City Council and the Berkeley Unified School District unanimously endorse the measure. Critics point to the unclear wording and loopholes of the measure, which includes exemptions for small retailers and beverages such as milk and alcohol. The Yes on D campaign wrote an open letter to Berkeley voters, which called the ABA its only real opponent.
“They are trying to buy the minds of our community,” Vicki Alexander, former Berkeley city health director and supporter of Measure D, said during a press conference, according to the article. “They are trying to buy the heart of our community.”
PepsiCo to End Use of Equipment With HFCs
PepsiCo announced on Friday that it will phase out the use of equipment with hydrofluorocarbons (HFC), a widely-used chemical coolant that is regarded as a potent greenhouse gas, according to The Wall Street Journal.
The company hopes to end use of coolers, vending machines, fountain dispensers and all other equipment using HFC by 2020. PepsiCo has already begun phasing out such equipment outside of the U.S., and will begin purchasing HFC-free equipment next year.
PepsiCo’s anti-HFC stance is part of a broader deal with other companies and the White House that aims to reduce global HFC consumption through 2025, The Journal notes.
On Sunday, The New York Times reported that global emission of greenhouse gases increased by 2.3 percent, to record levels.
PepsiCo Executive Heads to the NFL
Dawn Hudson, former president and CEO of Pepsi-Cola North America, has been named the chief marketing officer of the National Football League.
Not to be confused with Packers legend Don Hutson, she will oversee the development, direction and implementation of the league’s marketing activities, according to NFL.com.
Hudson will surely have her hands full while attempting to repair the league’s image, which has been tainted by criminal activity and cloudy logic in regards to discipline.
“Sports have always played a big role in my life and in my career,” Hudson told NFL.com. “While at Pepsi, I worked with numerous sports properties, including the NFL, and I also served as a [Ladies Professional Golf Association] board member.”