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Mubadala-backed Zamp to buy Starbucks brand rights, stores in Brazil

Published 06/06/2024, 08:33 AM
Updated 06/06/2024, 04:36 PM
© Reuters. Customers pass by the logo of an American coffee company Starbucks inside a coffee shop in Rio de Janeiro, Brazil August 15, 2018. REUTERS/Pilar Olivares/File Photo
SBUX
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SAO PAULO (Reuters) - Brazilian restaurant chain operator Zamp has agreed to buy the rights to operate the Starbucks (NASDAQ:SBUX) brand and some stores in the South American country, it said on Thursday, sending its shares soaring.

Zamp, which is controlled by Abu Dhabi state investor Mubadala, operates Burger King and Popeyes restaurants in Latin America's largest economy, and had disclosed in February it was in talks for the Starbucks deal.

The firm in a securities filing said the 120 million-real ($22.7 million) deal was signed with SouthRock, which owns the rights and assets and has been in bankruptcy protection since last year.

Sao Paulo-traded shares of Zamp jumped as much as 19.4% before closing with a nearly 10.2% gain.

It is not yet known exactly how many of the more than 100 Starbucks stores in the country Zamp would buy, the company said.

As required by SouthRock's bankruptcy proceedings, the deal would be implemented through a competitive process in which Zamp would have the right to match potentially higher bids, according to the filing.

Zamp said the deal requires approval from Brazil's antitrust watchdog CADE and the court overseeing SouthRock's bankruptcy.

It also needs a final agreement with Starbucks, which has so far agreed to an initial deal authorizing Zamp to explore the brand and develop operations of the coffee shop chain in Brazil.

A Starbucks spokesperson confirmed the company has been "in conversations with Zamp to directly manage Starbucks retail cafes across Brazil."

© Reuters. Customers pass by the logo of an American coffee company Starbucks inside a coffee shop in Rio de Janeiro, Brazil August 15, 2018. REUTERS/Pilar Olivares/File Photo

SouthRock confirmed the agreement, pending approvals, adding that it remains committed to its court-supervised reorganization proceedings to restructure and resume the growth of its business.

($1 = 5.2991 reais)

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