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Gong Cha to raise ownership in parent company up to 70%

South Korea’s popular bubble tea brand Gong Cha Korea is planning to raise its share in parent company Royal Tea Taiwan. Gong Cha Korea will increase ownership up to 70 per cent by January next year, the company announced. Currently, the Korean branch owns 35 per cent stake in RTT it has held since July. The company said that the memorandum of understanding (MOU) of the deal had been signed back in April. According to the agreement, Gong Cha Korea will buy an additional 35 per cent by January, while RTT shareholders will continue to hold the remaining 30 per cent. The acquisition is part of Gong Cha Korea’s efforts to expand its presence in the world. RTT was established in Taiwan in 2006, and was brought to Korea by Kim Yeo-jin, who acquired franchise license from RTT to open the country’s first store in Hongdae in 2012. In 2014, a Japan-based private equity fund Unison Capital Inc acquired 70 per cent stake in the Korean operation. Gong Cha Korea has more than 360 stores in Korea. It booked an 11 per cent growth year-on-year in 2015, reaching about 59 billion won ($52 million). Meanwhile, profit was recorded at 8 billion won.


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