Starbucks is selling one of its tea brands for $384 million

Starbucks tea
  • Starbucks is selling the Tazo tea brand for $US384 million.
  • The coffee giant says that it wants to focus on Teavana as its sole tea brand.
  • Starbucks sold $US1.6 billion in Teavana beverages in the last year.

Starbucks just sold one of its tea brands for $US384 million.

On Tuesday, the coffee giant announced that it had entered into an agreement to sell the Tazo brand — including recipes, intellectual property and inventory — to Unilever for $US384 million.

Teavana logo iced tea cups
Teavana will now be Starbucks’ sole tea brand. Starbucks

“Starbucks will continue to invest in the growth, innovation and development of the Teavana brand of teas in its stores and in channels outside its stores,” Starbucks said in a statement.

It continued: “The tea category in Starbucks stores continues to grow double-digits globally, with Starbucks well on its way to building the Teavana business to over $US3B over the next five years.”

Tazo was founded in 1994 and purchased by Starbucks for $US8.1 million in 1999. The brand, which is primarily available in grocery and convenience stores, encompasses packaged teas, K-Cup pods, and bottled beverages.

In July, Starbucks announced plans to close all 379 Teavana stores in the coming year, with the majority shuttering by spring 2018.

Despite these decision, Starbucks is making major investments in its tea business.

According to the company, customers bought more than $US1.6 billion worth of Teavana beverages in stores in the past year. Starbucks is also building its bottled tea business, launching ready-to-drink premium Teavana Craft Iced Teas with Anheuser-Busch InBev in 2016 and planning to enter the packaged tea category next year.