Starbucks is selling its cold-pressed juice brand, as the company focuses on its coffee-drink business and improving its stores and relations with its cafe workers under interim Chief Executive Howard Schultz.
Fresh-food maker Bolthouse Farms Inc. said it agreed to acquire Starbucks’s Evolution Fresh line of juices, which currently are sold in Starbucks cafes and supermarkets. Terms of the deal, which Bolthouse said is expected to close later this year, weren’t disclosed. Starbucks said the financial impacts of the deal weren’t expected to be material.
For Starbucks, the deal comes as Mr. Schultz directs more investment toward the coffee giant’s cafes and baristas. Mr. Schultz, the longtime Starbucks leader who returned in April for his third stint leading the chain, said the company needs to better handle increased demand, improve the cafe experience for customers and baristas, and increase communication between workers and executives.
Starbucks said it believes Bolthouse Farms has the beverage-industry experience to help Evolution Fresh grow, and shares Starbucks’s priorities for developing the brand and its employees.
The coffee chain in 2011 paid $30 million to acquire Evolution Fresh, when Mr. Schultz was at Starbucks’s helm for the second time. Mr. Schultz said at the time that the deal would give Starbucks a position in the $1.6 billion premium juice category, and products targeting the health and wellness sector.
Starbucks opened a handful of Evolution Fresh-branded juice bars, but later wound down that effort after Kevin Johnson was named Starbucks’s CEO in 2017. The company continued selling bottles of Evolution Fresh organic, cold-pressed juices in all of Starbucks’s U.S. stores.
Mr. Schultz told Starbucks investors earlier this month that since returning, he has pushed the company to focus squarely on improving its core U.S. business. In April he canceled billions of dollars in previously planned stock buybacks, saying Starbucks needed to invest more in its stores, including $200 million in additional compensation and training for workers.
Starbucks on Monday said it would permanently leave the Russia market, closing 130 stores after the country’s invasion of Ukraine.
The Evolution Fresh deal will add the brand to California-based Bolthouse’s portfolio of juices, which include vegetable, fruit and protein products. Bolthouse’s current brands represented about one-quarter of the U.S. sales of refrigerated beverages as of last month, according to data from market-research firm IRI.
“This is what we do. We grow stuff and turn it into juice,” said Bolthouse CEO Jeff Dunn. “They got a great supplier and we got a great brand.”
Bolthouse said it would keep the juice brand’s nearly 300 employees, who currently are employed directly by Starbucks in California. Over the roughly six-month sales process, Starbucks was focused on how Bolthouse would treat its employees and keep up juice supply to its stores, Mr. Dunn said.
Evolution Fresh, which is sold at Whole Foods Market and some other retailers in addition to Starbucks, had roughly 2% of the U.S. refrigerated-beverage market as of last month, according to IRI figures. Bolthouse intends to increase marketing of Evolution Fresh and get the products onto the shelves of other retailers, said Mr. Dunn, a former executive at Campbell Soup and Coca-Cola.
“People have awareness of it, but they don’t see it in a lot of other places other than Starbucks, or maybe Whole Foods,” he said. “We’ll expand the brand and really bring it to a lot more people.”
Bolthouse Farms, backed by private-equity firm Butterfly Equity, bought back its namesake brands from Campbell in 2019. It has looked to acquire other fresh-food brands since, Mr. Dunn said.