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Starbucks denies it is buying Chipotle after takeover speculation
CNBC • • general
Key Points:
- Starbucks officially denied rumors that it is considering acquiring Chipotle Mexican Grill, dismissing reports of a potential mega-deal between the two companies.
- Following the denial, Chipotle's stock dropped more than 2% in premarket trading, while Starbucks shares rose over 1%.
- Rumors of a takeover surfaced after reports that Starbucks had been working with advisers on a proposal, and Chipotle had hired advisers to defend against activist investors or unwanted bids amid a challenging year.
- Chipotle shares have fallen about 20% over the past year, making the company a more affordable acquisition target, but Starbucks shareholders are wary of a costly distraction during the company's own turnaround efforts.
- Investors were intrigued by the prospect of a reunion with Brian Niccol, former Chipotle CEO and current Starbucks CEO, but concerns remain about the strategic fit and timing of such a deal.
