Bain Capital acquires popular bubble tea chain Gong cha in $900m deal

Global bubble tea chain Gong cha has been snapped up by US private equity firm Bain Capital in a deal reportedly worth more than $US635 million ($900m).

Founded in Taiwan in 2006 and now headquartered in the UK, Gong cha operates nearly 2200 stores across 33 markets.

It is Australia’s biggest bubble tea chain by store count, with more than 170 outlets serving more than 15 million drinks a year.

Bain Capital is buying Gong cha from TA Associates, a private equity firm that purchased the bubble tea chain in 2019.

In a statement overnight on Wednesday, TA Associates said Gong cha had strengthened its position as a global category leader, known around the world for its high-quality, freshly-brewed whole leaf tea.

“Gong cha has built a highly differentiated brand, supported by a great team, a strong global network of franchisees and a unique menu of beverages centered around whole leaf tea that continues to resonate with consumers worldwide,” TA Associates managing director Edward Sippel said.

While the financial terms were not disclosed, Tokyo-headquartered Nikkei Media reported the deal was worth more than $US635m.

Gong cha global chief executive Paul Reynish said TA’s investment had been instrumental in supporting the brand’s global expansion and the continued development of its business model.

Over the past decade, Australia has seen an explosion of bubble tea — or boba — outlets. Gong cha competes with chains like Chatime, Presotea, King Tea, T4, as well as independent players across the country.

Bain Capital partner Naofumi Nishi said it looked forward to partnering with Gong cha to support its next phase of growth, including launching into new markets and expanding its footprint in existing markets.

Bain Capital has about $US225 billion of assets under management. In 2020, it bought Virgin Australia after the airline crashed into administration with billions of dollars of debt following the onset of the COVID pandemic.