Oct 8 (Reuters) – Starbucks has explored a takeover of Chipotle Mexican Grill, the Financial Times reported on Thursday, citing sources familiar with the matter.
A deal would unite two of the US restaurant industry’s best-known brands and deepen Starbucks CEO Brian Niccol’s ties to Chipotle, where he built his reputation before taking the helm at the coffee chain.
The coffee chain has worked with advisers in recent months on a takeover proposal for Chipotle, the FT reported, citing people familiar with the matter.
Starbucks and Chipotle did not immediately respond to Reuters requests for comment.
Shares of Chipotle, which has a market capitalization of nearly $39 billion, were up about 4% in early trading, while those of Starbucks were down about 3%. Starbucks is worth about $107 billion, according to LSEG data.
Niccol was brought in to turn around the coffee chain and in the last two years has aimed to improve customer experience through a simplified menu and shortened wait times, fueling four straight quarters of comparable sales growth.
Meanwhile, the burrito chain has been battling muted consumer demand and rising input costs amid still high inflation.
(Reporting by Neil J Kanatt in Bengaluru; Editing by Arun Koyyur)
