SHANGHAI (Reuters) - Food giant Nestle NESN.S on Thursday started selling Starbucks-branded SBUX.O coffee in mainland China, seeking to tap growth in a market where it says coffee consumption per capita remains low compared to global standards. Nestle last year paid $7.15 billion for exclusive rights to sell the U.S. chain’s coffees and teas globally, and began selling Starbucks-labelled products in Europe, Asia and Latin America in February. The world's largest food company will start selling 21 Starbucks-branded capsule and instant coffee products on Chinese e-commerce platforms like Alibaba's BABA.N Tmall and JD.com JD.O, as well as to offices and hotels in tier-1 cities, both companies said. “We believe China is the most exciting market in general but especially for coffee because... per capita cup consumption is quite low as compared to Asia,” said Rashid Aleem Qureshi, Nestle’s chief executive officer for the Greater China region. “Right now the overall soluble coffee in China is growing between 3-5% (a year) and we believe that by bringing this exciting new business opportunity we should be able to grow faster than that,” he said, referring to a category that includes capsule and instant coffee. Nestle’s move comes as the Swiss company experienced a slower first-half growth in China, its second-largest market, where other categories like mainstream baby foods have struggled compared to pricier options. China’s per capita coffee consumption is about 6 cups a year, compared to 400 in Japan and 300 in South Korea, Nestle said. The partnership with Starbucks would help Nestle add a premium coffee option to the range of products it already sells in China, such as Nescafe instant coffee range and Nespresso capsule coffees, Qureshi said. Starbucks China CEO Belinda Wong said the Nestle deal would open two new avenues to sell its products in China, where it has been investing heavily in its store network and delivery amid tougher competition from local startups.

An Indiana judge has taken an unusual step and temporarily barred Starbucks from closing 77 failing Teavana stores in Simon Property Group malls because the real estate giant was less able to handle the financial pain. Starbucks said in July it planned to shutter its 379-store Teavana operation — but Simon rushed to court to block 77 stores in its malls from going dark — claiming such a move by a high-profile tenant could spark other stores in its malls to close. Starbucks, after trying to turn around its stumbling tea chain, said last August it was pulling the plug on Teavana. It wanted to close all the stores by the end of the year. But Indianapolis-based Simon, in an environment where hundreds of stores across the country are closing, rushed to a local court to ask Judge Heather Welch to stop the store closing. Welch, in a 55-page order, found that the very profitable Starbucks could absorb the financial hit — estimated by Starbucks to be $15 million over five months — better than Simon could. The mall operator did not provide an estimate of how much the closings of the Teavana stores would hurt them. The case is being closely watched by retailers and landlords alike amid a retail meltdown that has resulted in a record number of bankruptcies this year. The retail failures have left landlords scrambling to find new tenants and retailers in the difficult position of breaking their leases. Still, it is rare that a judge orders a retailer to keep stores open, retail experts said. “I’m somewhat shocked by the ruling,” said real estate lawyer Joshua Stein. Welch “catalogues every possible detriment to Simon as a result of having vacant space,” Stein said, adding, “That’s part of a job description of owning real estate. You deal with it and don’t get injunctions to have your tenant continuing to operate.” Other industry experts, who did not want to be identified, said the ruling will send a chill down the spines of distressed retailers. “If you are a tenant that has to close a bunch of stores that are based in malls,” said one source, “you are pretty scared after this ruling.” Welch admitted that “no court has ever entered preliminary or permanent injunctive relief to specifically enforce a continuous operations covenant against a non-anchor tenant” — but she did so anyway. “We are disappointed in the judge’s ruling and will continue to focus on finding a resolution,” Starbucks, which has a market cap of $81 billion, said in a statement, noting that it is not clear whether it will appeal — or even if it is permitted to do so. Simon’s vacancy rate as of Sept. 30 was 4.7 percent — slightly below the 4.8 percent national vacancy rate for all malls, according to JLL data. Simon argues that if Starbucks is allowed to “prematurely” break its lease, it could be forced to fill the vacancies with “less creditworthy tenant(s)” or less desirable tenants “who will only agree to less desirable lease terms, and/or a shorter-term lease,” according to the court filings. Industry sources suggested that other mall operators may now challenge Starbucks’ plans to close Teavana stores in their shopping centers. Shares of Simon Property Group, a $52 billion company, gained 60 cents on Friday, to $162.35.

An Indiana judge has taken an unusual step and temporarily barred Starbucks from closing 77 failing Teavana stores in Simon Property Group malls because the real estate giant was less able to handle the financial pain. Starbucks said in July it planned to shutter its 379-store Teavana operation — but Simon rushed to court to block 77 stores in its malls from going dark — claiming such a move by a high-profile tenant could spark other stores in its malls to close. Starbucks, after trying to turn around its stumbling tea chain, said last August it was pulling the plug on Teavana. It wanted to close all the stores by the end of the year. But Indianapolis-based Simon, in an environment where hundreds of stores across the country are closing, rushed to a local court to ask Judge Heather Welch to stop the store closing. Welch, in a 55-page order, found that the very profitable Starbucks could absorb the financial hit — estimated by Starbucks to be $15 million over five months — better than Simon could. The mall operator did not provide an estimate of how much the closings of the Teavana stores would hurt them. The case is being closely watched by retailers and landlords alike amid a retail meltdown that has resulted in a record number of bankruptcies this year. The retail failures have left landlords scrambling to find new tenants and retailers in the difficult position of breaking their leases. Still, it is rare that a judge orders a retailer to keep stores open, retail experts said. “I’m somewhat shocked by the ruling,” said real estate lawyer Joshua Stein. Welch “catalogues every possible detriment to Simon as a result of having vacant space,” Stein said, adding, “That’s part of a job description of owning real estate. You deal with it and don’t get injunctions to have your tenant continuing to operate.” Other industry experts, who did not want to be identified, said the ruling will send a chill down the spines of distressed retailers. “If you are a tenant that has to close a bunch of stores that are based in malls,” said one source, “you are pretty scared after this ruling.” Welch admitted that “no court has ever entered preliminary or permanent injunctive relief to specifically enforce a continuous operations covenant against a non-anchor tenant” — but she did so anyway. “We are disappointed in the judge’s ruling and will continue to focus on finding a resolution,” Starbucks, which has a market cap of $81 billion, said in a statement, noting that it is not clear whether it will appeal — or even if it is permitted to do so. Simon’s vacancy rate as of Sept. 30 was 4.7 percent — slightly below the 4.8 percent national vacancy rate for all malls, according to JLL data. Simon argues that if Starbucks is allowed to “prematurely” break its lease, it could be forced to fill the vacancies with “less creditworthy tenant(s)” or less desirable tenants “who will only agree to less desirable lease terms, and/or a shorter-term lease,” according to the court filings. Industry sources suggested that other mall operators may now challenge Starbucks’ plans to close Teavana stores in their shopping centers. Shares of Simon Property Group, a $52 billion company, gained 60 cents on Friday, to $162.35.

Starbucks Korea is expected to exceed a record 100 billion won (US$88.4 million) profit this year as the US coffee chain’s popularity booms. Industry sources told Yonhap news agency that the 50-50 joint venture between retail conglomerate Shinsegae and the US company achieved a 52.8 billion won operating profit on 593.5 billion won in sales during the first six months this year. That marks the first time Starbucks recorded more than 50 billion won in profit since it opened its first local branch near Ewha Womans University in Seoul in 1999. Full-year profit is likely to easily surpass the 100 billion-won mark as coffee shops usually earn more during the latter half of the year, which includes Christmas and the year-end holiday season. The strong figure compares with those of its local competitors Twosome Place and Angel-in-Us Coffee, which averaged between 10 and 20 billion won during the same period. Sources told Yonhap the popularity of Starbucks in South Korea is due to the growing loyalty of women in their 20s and 30s, pointing out that the company has succeeded in promoting its image as a luxury brand in South Korea where the luxury coffee market has yet to mature. Starbucks Korea’s annual sales topped the 1 trillion-won mark for the first time last year. Starbucks has 1050 stores in the country as of the end of June, the world’s fourth-largest number of Starbucks Coffee stores on a pro-rata population basis, behind only Canada, the US and Singapore, according to industry data. The number of the stores has risen sharply from 327 in 2010 and 500 in 2013 to 1000 as at the end of last year. The dramatic rise has apparently been helped by the regulations that ban franchises from opening new stores within a 500-metre radius from the shop of the same brand: Running its own stores, rather than franchising, exempts Starbucks from such regulations. However, critics say while the regulations aimed to protect food franchise contractors from intense competition, they have instead aided foreign businesses operating in South Korea. “We are not subjected to the franchise law as all of our shops are run by the company directly,” a Starbucks Korea official said.

Starbucks has tapped Rosalind Brewer, the former president and CEO of Sam's Club, to take on the role of chief operating officer and group president, effective Oct. 2. Brewer will lead the company's operating businesses across the U.S., Canada, and Latin America, as well as the global functions of supply chain, product innovation, and store development organizations. "Starbucks is a culture-first company focused on performance and Roz is a world class operator and executive who embodies the values of Starbucks," Kevin Johnson, Starbucks' president and CEO, said in a statement Wednesday. Johnson said that Brewer had been a "trusted strategic counselor" to him since her appointment to the company's board of directors in January. Brewer, who has more than 30 years of management experience and 10 years of experience leading multinational retailers, will continue to serve on the board of directors, the company said. "Ms. Brewer has a wealth of experience in retailing, consumers and [consumer packaged goods] markets," Neil Saunders, managing director of GlobalData, told CNBC via email. "She is also used to running large, complex organization with a global focus." Starbucks has hit some snags in recent quarters in its retail sales, blaming slowing mall traffic for weak sales at its Teavana stores, in particular. The company plans to shutter all 379 of these locations by spring 2018 to deal with the prolonged underperformace. "[Brewer] was instrumental in making changes at Sam's Club to bring the retailer more in line with trends around health and wellness," Saunders said. "She also did a lot in terms of e-commerce and multichannel, and this experience will be valuable for Starbucks."

Starbucks (SBUX) announced on Thursday that all 379 Teavana stores -- which are primarily based in malls across the country -- have been "underperforming." The move will impact 3,300 workers. "The company concluded that despite efforts to reverse the trend through creative merchandising and new store designs, the underperformance was likely to continue," Starbucks said in a press release. Most locations will shut down by Spring 2018, Starbucks said, and people employed at Teavana locations will be invited to apply for jobs at Starbucks locations in order to preserve their jobs. The coffee giant first announced plans to purchase the struggling tea retailer Teavana in 2012 for $620 million. Teavana's announcement is the latest in a wave of store closings inside American malls. Retailers from JCPenney (JCP) to GameStop (GME) have announced plans to shut down brick-and-mortar locations as they struggle to keep pace with e-commerce sites. There were 5,300 store closing announcements in the first six months of the year, triple the number during the same period last year, according to an analysis by Fung Global Retail & Technology. Between 20% and 25% of American malls will close within five years, Credit Suisse said in a report released last month. Despite the Teavana closures, Starbucks again said it's expanding rapidly, with plans to add 240,000 jobs globally over the next five years. However, most of that growth is taking place overseas, particularly in China. Starbucks said earlier on Thursday that it plans to make another major investment in China. Currently, Starbucks shops are popping up at a rate of one-per-day. CNNMoney (New York) First published July 27, 2017: 5:09 PM ET