SEATTLE, Washington: U.S. coffee company Starbucks has said it is not planning to sell all of its business in China, even though a Chinese magazine, Caixin, reported that it was. Caixin didn't explain where it got its information.

The report also said Starbucks had spoken to over a dozen possible buyers, though it wasn't clear exactly what part of the business might be for sale.

In response, a Starbucks spokesperson said, "Starbucks is not currently considering a full sale of its China operations."

However, sources familiar with the situation said Starbucks started a formal process in May to explore possible deals. Interested buyers were asked to answer questions about their company values, management style, sustainability efforts, employee treatment, and their business plans for Starbucks China. Goldman Sachs is advising Starbucks on the process.

Still, Starbucks hasn't decided if it will sell a large (controlling) or small (minority) part of its China business, or if it will keep some parts, like its supply chain, according to two sources.

The company wouldn't comment further, and Goldman Sachs didn't reply to Reuters' request for a statement.

In 2023, Starbucks opened a large US$209 million roasting and distribution center in Kunshan, near Shanghai. This center can supply all of its stores in China.

More than 20 groups, including private equity firms, have responded to Starbucks' request for information, one source said. Starbucks is expected to narrow down the list of potential buyers soon.

"The goal was to let each group present their plans freely and then choose the best option," one source explained.

Earlier this year, Reuters reported that major investment firms like KKR & Co., Fountainvest Partners, and PAG were interested in buying a share in Starbucks China.

The talks come at a difficult time for Starbucks in China. Its market share there has dropped from 34 percent in 2019 to 14 percent in 2024. The company has lost ground to cheaper local coffee chains like Luckin and Cotti, as many Chinese customers are spending less.

Online shopping apps and delivery services have made coffee even cheaper, sometimes under 5 yuan (less than $1) per cup with coupons and discounts.

In response to the pressure, Starbucks announced its first price cut in China earlier this month, lowering prices on some iced drinks by an average of five yuan.