Starbucks has reportedly explored buying Chipotle Mexican Grill in recent months, working with advisers on a takeover proposal, according to sources cited by the Financial Times. The U.S. coffee giant, which generates approximately $31 billion in annual domestic sales, could acquire the fast-casual burrito chain, which reports more than $11 billion in system-wide sales. The announcement sent Chipotle stock up 7% while Starbucks shares fell 4%. Analysts remain skeptical: D.A. Davidson analyst Matt Curtis estimates only a 20% probability the deal will close. Starbucks CEO Brian Niccol is well acquainted with the company, having led Chipotle for more than six years before joining the coffee chain. With Chipotle’s market cap hovering around $42 billion, the acquisition would represent the largest restaurant takeover ever, a major challenge for Starbucks, which already carries approximately $9.4 billion in debt and is still executing its own turnaround strategy.
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