China Resources to buy HK coffee chain

HONG KONG - China Resources Enterprise Ltd, the country's largest brewer, will buy control of Hong Kong's second-largest coffee chain, aiming to expand and surpass Starbucks Corp on the mainland.

Chevalier Pacific Holdings Ltd said in a statement on Tuesday that China Resources will pay HK$326.6 million ($42 million) for 80 percent of Pacific Coffee Group. The chain has 83 outlets in the city, compared with more than 100 for Starbucks, the largest coffee-shop operator in both China and the world.

China Resources plans to expand Pacific Coffee into the mainland's largest chain from five existing outlets, in part by opening branches in its 200 hypermarkets, Deputy Managing Director Frank Lai said on Tuesday. Starbucks now has about 380 stores in the mainland, and plans to have "thousands" there eventually, Chief Executive Officer Howard Schultz said in April.