Starbucks Acquisitions

Since Starbucks was founded in 1971, it has not merged with any other companies. However, it has acquired several companies such as Tazo Tea in 1999, Seattle Coffee Company in 2003, Ethos Water in 2005, Coffee Equipment Company and its Clover brewing system in 2008, Evolution Fresh in 2011, and Teavana in 2012 (Starbucks Company, 2012). Starbucks acquired Teavana for $620 million in December of 2012. It has been Starbucks’ largest acquisition to date (De La Merced & Strom, 2012). The acquisition allowed Starbucks to differentiate its product offering by expanding from just coffee. Starbucks aims to transform the tea industry as it already has for the coffee industry. Teavana is a specialty tea retailer offering over 100 varieties of loose-leaf teas (Starbucks, 2012). For the first time, Teavana teas were available for purchase in Starbucks stores at the start of 2015.

In 2012, Starbucks Coffee Company announced plans for a joint venture with Tata Global Beverages Limited to open Starbucks cafes in India under the branded name TATA Starbucks Limited. Tata is an iconic international coffee brand and the second largest branded tea company in the world. Under the alliance, Tata Coffee Limited agreed to supply coffee to joint locations and to export coffee to Starbucks Coffee Company (Tata, 2012). The plan called for retail stores to be developed in cities across the country beginning with Delhi and Mumbai. This joint venture allowed Starbucks to spread its specialty coffee around the world and share its unique Starbuck’s experience with more customers.

Through merger activity, Starbucks has been able to increase the value of its stock. The acquisitions and alliances Starbucks has engaged in have allowed the company to expand to new customer segments and increase its product offering. Through each of these activities, Starbucks has maintained a positive public image due to its excellent customer service and increasing revenues. Since its IPO, Starbucks has been...