Saudi PIF shortlisted as bidder for stake in Starbucks Mideast

© Reuters. FILE PHOTO: A closed Starbucks cafe is seen at Dubai Worldwide Airport amid the outbreak of the coronavirus illness (COVID-19) in Dubai, UAE April 27, 2020. REUTERS/Ahmed Jadallah

By Hadeel Al Sayegh and Saeed Azhar

DUBAI (Reuters) – Saudi Arabia’s sovereign wealth fund, the Public Funding Fund (PIF), has been shortlisted to purchase a stake within the Center East, North Africa and central Asia Starbucks (NASDAQ:) franchise held by Alshaya Group, two sources advised Reuters.

The Starbucks franchise within the area has a number of hundred retailers in 14 nations throughout the Center East, Russia, and central Asia.

Kuwait-based Alshaya Group, the area’s main model franchise proprietor, final 12 months employed JPMorgan (NYSE:) to promote a big minority stake within the enterprise. The sources mentioned it might promote as much as 30%, producing $4 billion-$5 billion.

The PIF, which manages over $600 billion of property, declined to remark. Alshaya didn’t instantly reply to a request for remark. JPMorgan additionally declined to remark.

The PIF is among the many bidders which have made it to the following spherical because the sale course of nears its remaining phases, the supply mentioned.

A number of non-public fairness bidders have been additionally within the race, together with CVC Capital Companions and Brookfield, however it was not instantly clear if they’d been shortlisted.

Abu Dhabi state fund Mubadala Funding Co and Abu Dhabi state holding fund ADQ are not within the race, the 2 sources mentioned. Mubadala declined to remark, whereas ADQ didn’t instantly reply to a request for remark.

The deal would widen the investor base of a enterprise privately held by the Alshaya household since 1999, one of many sources mentioned.

Among the Center East’s largest privately-owned firms are warming to the concept of bringing in outdoors traders by listings or strategic stake gross sales.

Saudi Arabia has seen a spate of listings in recent times as the dominion encourages extra family-owned firms to drift in a bid to deepen its capital markets below reforms aimed toward decreasing reliance on oil revenues.

The second supply mentioned funds raised may very well be used in direction of different companies Alshaya owns, and that the valuation of the corporate is enticing, making the sale of a stake compelling.

The privately held Alshaya Group says it’s the oldest firm in Kuwait, first registered in 1890. It runs franchises together with H&M, Mothercare, Debenhams, American Eagle Outfitters (NYSE:) and Victoria’s Secret.