Starbucks to Acquire La Boulange Bakery (SBUX)

PUBLISHED: 05 Jun 2012 @ 15:24 | Comments (0) | More info about Ed Liston

Seattle-based Starbucks Corporation (NASDAQ:SBUX) on Monday announced that it entered into an agreement to acquire La Boulange bakery for $100 million in cash. The acquisition will enable SBUX to improve its food offerings.

The acquisition of La Boulange comes as food continues to become an important part of SBUX’s revenue stream. Food segment now accounts for $1.5 billion in revenue a year at SBUX.

Starbucks plans to start replacing the current line of baked goods with baked goods from La Boulange early next year. The coffee chain plans to roll out the products in Bay area stores first before offering them nationally.

Cliff Burrow, President of Starbucks America, said that the company plans to take it one store at a time, beginning in metropolitan areas around the U.S.

Based in San Francisco, La Boulange bakery has 19 locations in the Bay area, serving salads and sandwiches apart from baked gods. SBUX is acquiring the bakery chain from Next World Group, which is a San Francisco-based privately held investment firm.

Investors, however, seem to have reacted negatively to SBUX’s latest acquisition, with shares falling more than 3% in pre-market trading on Tuesday.

CLICK HERE TO REGISTER FOR FREE ON ADVFN, the world's leading stocks and shares information website, provides the private investor with all the latest high-tech trading tools and includes live price data streaming, stock quotes and the option to access 'Level 2' data on all of the world's key exchanges (LSE, NYSE, NASDAQ, Euronext etc).

This area of the ADVFN.com site is for independent financial commentary. These blogs are provided by independent authors via a common carrier platform and do not represent the opinions of ADVFN Plc. ADVFN Plc does not monitor, approve, endorse or exert editorial control over these articles and does not therefore accept responsibility for or make any warranties in connection with or recommend that you or any third party rely on such information. The information available at ADVFN.com is for your general information and use and is not intended to address your particular requirements. In particular, the information does not constitute any form of advice or recommendation by ADVFN.COM and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Authors may or may not have positions in stocks that they are discussing but it should be considered very likely that their opinions are aligned with their trading and that they hold positions in companies, forex, commodities and other instruments they discuss.