The sale of a stake in Starbucks’ Middle East, North Africa, and Central Asia franchise, operated by Kuwait’s AlShaya Group, has been postponed, according to two sources familiar with the situation.
Geopolitical unrest and ongoing boycotts in the region have complicated the valuation process for potential buyers. Consequently, AlShaya Group is not rushing to finalise the sale, one source said, requesting anonymity due to the confidential nature of the negotiations.
Previously known as “Project Emerald,” the sale involves a minority stake of approximately 30 per cent. The discussions might resume next year if conditions improve, a second source noted.
Interest in the sale has come from U.S. private equity firm Apollo Global Management Inc. and Saudi Arabia’s Public Investment Fund (PIF), Reuters reported earlier.
Starbucks has declined to comment on the matter, stating that it does not engage with rumours or speculation. AlShaya Group also chose not to provide any comment.
The franchise, which operates around 2,000 outlets across 13 countries including the Middle East, North Africa, Kazakhstan, and Azerbaijan, was valued between $4 billion and $5 billion in 2022, before exiting Russia.
In January, Starbucks reported that its business in the region had been affected by the Israel-Hamas conflict, which prompted some consumers to protest and launch boycott campaigns against the company. Despite these challenges, Starbucks affirmed its commitment to international growth.
Earlier this year, Reuters reported that AlShaya Group planned to lay off over 2,000 employees due to the adverse impact of consumer boycotts related to the Gaza war. The stake being sold would diversify the investor base of a business held by the AlShaya family since 1999.
Source: Reuters
