Boyu Capital has emerged as the leading contender to acquire a controlling stake in Starbucks’ China operations, in a potential deal valuing the business at more than $4bn, according to Bloomberg.

The Chinese private equity firm has reportedly outbid rivals including Carlyle Group in a process that also attracted interest from KKR, EQT, Hillhouse Investment, FountainVest Partners, and Primavera Capital. Discussions between Starbucks and Boyu are ongoing and could take several months to finalise, though a transaction is not yet guaranteed.

Sources said other strategic or technology investors could join as limited partners to help co-finance the deal.

Starbucks has operated in China since 1999 and now runs roughly 7,800 stores across more than 250 cities, making it the company’s second-largest market after the United States. Despite plans to expand its network to 20,000 stores, the Seattle-based coffee chain has faced mounting competition from local players, particularly Luckin Coffee.

CEO Brian Niccol has previously stated that Starbucks plans to retain a “meaningful” ownership stake in the China business. The company launched the search for a new investor earlier this year, shortlisting about a dozen firms before narrowing the field to Boyu and a few others.

Founded in 2011, Boyu Capital focuses on growth-oriented investments across technology, consumer, healthcare, and renewable energy. The firm’s bid for Starbucks China reflects the growing role of Asian private equity investors in the global consumer and retail sector, as they seek to back domestic brands and international franchises with deep regional appeal.

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