China’s Luckin Coffee moves to buy Blue Bottle in US$400m deal as competition with Starbucks heats up

NEW YORK, March 7 — Luckin Coffee is reportedly close to acquiring Blue Bottle in a deal valued at just under US$400 million (RM1.5 billion), marking the Chinese chain’s most assertive move yet in its escalating rivalry with Starbucks.

Fast Company reported that the acquisition would give Luckin a foothold in the premium “third wave” coffee segment, which Blue Bottle helped popularise.

The report noted that Starbucks remains the world’s largest coffee company with about 40,000 stores and US$37 billion in revenue, while Luckin expanded rapidly in 2025 to roughly 31,000 outlets.

Luckin’s model relies on smaller stores and digital ordering, and the company has been willing to operate at a loss to enter new markets, including taking over former Starbucks locations.

Starbucks, meanwhile, has been pursuing a design‑driven turnaround under CEO Brian Niccol, who has focused on warmer store concepts and a revamped menu to revive customer traffic.

The broader coffee market has also become more crowded, with chains such as Dunkin’, Tim Hortons, Dutch Bros and Blank Street competing for consumers seeking convenience, lower prices or novelty drinks.

Blue Bottle, which operates about 140 stores globally, has struggled to achieve profitability even as interest in high‑end, single‑origin coffee has waned in the age of iced beverages and matcha.

Fast Company reported that Centurium Capital, which controls Luckin, has begun exploring potential Blue Bottle locations in China, including former Starbucks Reserve sites.

Nestlé, which bought Blue Bottle in 2017 and later acquired full ownership, appears to have retained the brand’s grocery and packaged‑coffee business as part of the sale to Centurium.

The report said Nestlé may have taken a loss on the café business but kept Blue Bottle’s retail presence, which complements its broader coffee portfolio that includes Nescafé, Coffee Mate and Starbucks‑branded packaged products.

Nestlé does not disclose revenue from Blue Bottle’s consumer products, but its Starbucks retail line generated about US$2 billion in 2018.

Analysts told Fast Company that the long‑term outcome of the Blue Bottle sale will depend on how Luckin develops the brand, how Starbucks responds, and whether consumers still value the premium coffee experience that defined the third wave movement.