Monday, September 25, 2006
Starbucks Picks an Indian Partner
For ages, there has been a guessing game afoot as to who Starbucks was going to join hands with, to enter the Indian market. Given that Sequoia had invested $20 million in Cafe Coffee Day to scale up dramatically, and the trouble Barista has been in, I could have sworn Starbucks would come in via a Barista takeover. However, their choice of Indian partner has been a complete surprise to me. Starbucks has chosen to partner with the RPG Group, which owns Spencer and Musicworld, according to the Financial Express.
Though the fine print of the deal is still being worked out, Starbucks is likely to take 51% stake (the maximum allowed in a retail venture so far) with RPG retaining 49% in a joint venture that will also be the Seattle-based firm’s master franchisee for India. RPG will appoint a chairman to the JV and the CEO will be chosen by Starbucks, according to sources involved in discussions. RPG vice-chairman Sanjiv Goenka, who handles the group’s retail business, is expected to be the chairman.
