Starbucks Explored Takeover of Chipotle, FT Reports

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Summary · why it matters

Starbucks has explored a potential acquisition of Chipotle Mexican Grill, according to a Financial Times report that sent shares of both restaurant chains swinging sharply Thursday. Chipotle shares initially jumped as much as 8% on the report, while Starbucks fell as much as 6%, before both pared those moves as investors weighed the implications of a deal. The Financial Times reported that Starbucks has worked with advisers in recent months on a potential proposal for Chipotle, which currently has a market value of nearly $39 billion, though the status of those plans, including whether a formal offer has been made, remains unclear. A combination would reunite Starbucks CEO Brian Niccol with the fast-food chain he led for six years before leaving to take over as Starbucks chief executive in August 2024, and would create a restaurant giant with nearly $50 billion in combined annual sales based on last year's figures. If completed, the transaction would dwarf Burger King's $11.4 billion acquisition of Tim Hortons in 2014 and rank as the largest restaurant-sector acquisition on record, though the Financial Times cautioned that a deal of such scale may never materialize given the complexity of combining two major consumer brands. Starbucks declined to comment on the report, while Chipotle did not immediately respond to inquiries.

Impact on assets 4

Consumer Discretionary± Mixed
Chipotle Mexican Grill Inc
CMG
▲ PositiveCapitalrelevance

Starbucks explored a potential acquisition of Chipotle, sending Chipotle shares up as much as 8% on the takeover report.

Starbucks Corporation
SBUX
▼ NegativeCapitalrelevance

Starbucks reportedly explored a potential Chipotle acquisition, a large complex deal that sent its shares down as much as 6%.